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The refinery in Nikiski makes jet, diesel, gasoline, propane, and asphalt. Even operating at capacity, it isn't enough to meet demand in the Alaska market, and jet is imported to the port of anchorage on a regular basis. The higher cost comes from shipping, and higher production costs here, because utilities cost more, as does all the supplies, due to the distance to ship them here. Also, most chemicals have to be shipped via hazmat, which is even more expensive. It costs more to do business here, due to the remote location. But who would want to live anywhere else? Alaska is a wonderful place to live.
I especially agree with that last part...
And I understand the other part about costs - It seems that the cost of not barging crude out would help to make up the cost of getting the other chemicals and higher utility costs. Apparently, it doesn't. I also understand that it is more difficult/involved to refine in cold climates.
I think the volume out of NP is pretty low these days, isn't it?
Petro Star has always been fairly small. When Flint Hills shut down, I thing Petro Star picked up a very small portion of their business, but certainly nothing major. Flint Hills is now a distribution terminal and I think the bulk of what is kept there does come from Nikiski.
Dont let people fool you, shipping costs while high dont account for most of the fleecing up here. Most of it is legacy real estate holders charging exorbant lease rates, those costs get passed down so that buisness can stay running. Its why BP owns their own property so that they can fix costs in hard times, Conoco sold their building which I thought was foolish unless they were going to pull out completely.
Commercial real estate in key areas rarely comes up for sale here so anyone that wants to do buisness has to lease and the lease fees never end unlike a mortgage. The last time alot of these strip malls went up for sale was in the mid 80's.
Unfortunatly it takes a substantial economic crash to put pressure on these crooks and alot of other people get stung along with them.
Quote:
Originally Posted by Dakster
[/b]
I especially agree with that last part...
And I understand the other part about costs - It seems that the cost of not barging crude out would help to make up the cost of getting the other chemicals and higher utility costs. Apparently, it doesn't. I also understand that it is more difficult/involved to refine in cold climates.
Dont let people fool you, shipping costs while high dont account for most of the fleecing up here. Most of it is legacy real estate holders charging exorbant lease rates, those costs get passed down so that buisness can stay running. Its why BP owns their own property so that they can fix costs in hard times, Conoco sold their building which I thought was foolish unless they were going to pull out completely.
Commercial real estate in key areas rarely comes up for sale here so anyone that wants to do buisness has to lease and the lease fees never end unlike a mortgage. The last time alot of these strip malls went up for sale was in the mid 80's.
Unfortunatly it takes a substantial economic crash to put pressure on these crooks and alot of other people get stung along with them.
We have had economic crashes in the past, and the high cost of living never changed. Even if BP and other businesses own their own buildings, they still pay very high property tax. The same goes for pipelines and related property across borough lands. While we don't have a State income tax, property taxes around Fairbanks, Juneau, and Anchorage are some of the highest in the US. The high cost of living is across the board, for avery product or service you pay for, lease, and so on.
The cost for housing is very high compared to most places in the lower-48, but healthcare is also very high. Even so, the cost for housing in Alaska is not necessarily the main reason for the high cost of living. Just look at the cost for the following: groceries, housing, utilities, transportation, health, and misc. at the 2014 link above, and notice which of those areas are the most and least expensive in Alaska, then compare them to the other States in the article. http://www.usatoday.com/story/money/...ates/15455129/
So you are telling me that between the commerical lease rates and rent/buy costs of residential property have a nominal impact on the cost of living? Yes you are going to have to pay the property taxes no matter what but I can garentee you that the spread between what the commercial real estate holders charge in rent and what they pay in taxes is VERY LARGE.
If all you had to pay was for shipping and property taxes up here you would be sitting pretty. I suppose if you have a bunch of medical problems the health care could factor in but at that point I would probably not live up here anymore if I was having to go to substantial medical visits more than once a year.
I am also talking specificly about Anchorage, the same may apply in other areas as well but the economies of scale for shipping to anchorage are not horrible.
I am honestly not sure why its so hard for people to have an honest conversation about the real reasons it costs so much here and discuss the 300 lb gorrila in the room rather than the other penny anty stuff. I have a very hard time believing that shipping costs stand toe to toe with real estate holder fleecing.
Quote:
Originally Posted by RayinAK
We have had economic crashes in the past, and the high cost of living never changed. Even if BP and other businesses own their own buildings, they still pay very high property tax. The same goes for pipelines and related property across borough lands. While we don't have a State income tax, property taxes around Fairbanks, Juneau, and Anchorage are some of the highest in the US. The high cost of living is across the board, for avery product or service you pay for, lease, and so on.
The cost for housing is very high compared to most places in the lower-48, but healthcare is also very high. Even so, the cost for housing in Alaska is not necessarily the main reason for the high cost of living. Just look at the cost for the following: groceries, housing, utilities, transportation, health, and misc. at the 2014 link above, and notice which of those areas are the most and least expensive in Alaska, then compare them to the other States in the article. 7 most expensive states to live in the U.S.
So you are telling me that between the commerical lease rates and rent/buy costs of residential property have a nominal impact on the cost of living? Yes you are going to have to pay the property taxes no matter what but I can garentee you that the spread between what the commercial real estate holders charge in rent and what they pay in taxes is VERY LARGE.
If all you had to pay was for shipping and property taxes up here you would be sitting pretty. I suppose if you have a bunch of medical problems the health care could factor in but at that point I would probably not live up here anymore if I was having to go to substantial medical visits more than once a year.
I am also talking specificly about Anchorage, the same may apply in other areas as well but the economies of scale for shipping to anchorage are not horrible.
I am honestly not sure why its so hard for people to have an honest conversation about the real reasons it costs so much here and discuss the 300 lb gorrila in the room rather than the other penny anty stuff. I have a very hard time believing that shipping costs stand toe to toe with real estate holder fleecing.
I wasn't telling you other than the cost of living in Alaska compared to the other six States in the article, so please allow me to explain again as I compare some of these States:
a. Alaska (quoted from the article)
Quote:
Cost of Living Index: 131.8
Grocery Index: 128.4
Housing Index: 147
Utilities Index: 161.7
Transportation Index: 115
Health Index: 144.8
Misc.: 116.8
Quote:
5. New Jersey
Cost of Living Index: 127.6
Grocery Index: 108.2
Housing Index: 167.7
Utilities Index: 117.3
Transportation Index: 112.4
Health Index: 104.3
Misc.: 116.1
Quote:
6. California
Cost of Living Index: 127.1
Grocery Index: 113.6
Housing Index: 176.7
Utilities Index: 113.6
Transportation Index: 111.1
Health Index: 109.7
Misc.: 106.2
Quote:
7. Connecticut
Cost of Living Index: 125.2
Grocery Index: 124
Housing Index: 136.1
Utilities Index: 116.3
Transportation Index: 119
Health Index: 120.4
Misc.: 122.8
That high cost of living depends on several factors such as the cost of groceries, housing, utilities, transportation (buses, trains, automobiles, etc.), health care (medical, dental), and misc. cost. You will notice that the cost for housing is cheaper in Alaska than NY, and CA, but utilities was higher in 2014 in Alaska (fuel was more expensive), and transportation slightly higher than CA. In here we don't have bus lines and trains moving people across the State. In fact, we don't even have road access to a great portion of Alaska, so often the means for transporting people and goods is by aircraft, by water where is not frozen, or icy trails during the winter months. And fuel was quite expensive until recently.
Health care, dental, and vision is very expensive in Alaska because we don't have very specialized hospitals and clinics. We just don't have a clientele that is large enough to support major hospitals and clinics providing specialized care. That's why most insurance companies in Alaska allow you to travel to Seattle and other places in the lower-48 where such medical specialists are.
Shipping cost depends on weight and bulk, among other factors. If a person is in relatively good health, and young enough, he or she would probably would not have to go to the hospital for health care. But that person would at least need dental care for cleaning. Don't you think so?
I don't know what else to tell you but to read all the "indexes" above for each State. The cost of living depends on the total of those indexes, not just by grouping one or two of them.
Ok so we are doing slightly better than the most expensive places in the usa with 20 times our population and that's good? I agree we are cheaper than manhatten and san fran ...... and your point is?
Quote:
Originally Posted by RayinAK
I wasn't telling you other than the cost of living in Alaska compared to the other six States in the article, so please allow me to explain again as I compare some of these States:
a. Alaska (quoted from the article)
That high cost of living depends on several factors such as the cost of groceries, housing, utilities, transportation (buses, trains, automobiles, etc.), health care (medical, dental), and misc. cost. You will notice that the cost for housing is cheaper in Alaska than NY, and CA, but utilities was higher in 2014 in Alaska (fuel was more expensive), and transportation slightly higher than CA. In here we don't have bus lines and trains moving people across the State. In fact, we don't even have road access to a great portion of Alaska, so often the means for transporting people and goods is by aircraft, by water where is not frozen, or icy trails during the winter months. And fuel was quite expensive until recently.
Health care, dental, and vision is very expensive in Alaska because we don't have very specialized hospitals and clinics. We just don't have a clientele that is large enough to support major hospitals and clinics providing specialized care. That's why most insurance companies in Alaska allow you to travel to Seattle and other places in the lower-48 where such medical specialists are.
Shipping cost depends on weight and bulk, among other factors. If a person is in relatively good health, and young enough, he or she would probably would not have to go to the hospital for health care. But that person would at least need dental care for cleaning. Don't you think so?
I don't know what else to tell you but to read all the "indexes" above for each State. The cost of living depends on the total of those indexes, not just by grouping one or two of them.
Ok so we are doing slightly better than the most expensive places in the usa with 20 times our population and that's good? I agree we are cheaper than manhatten and san fran ...... and your point is?
Is that what I implied?
a. I don't know how to make it more simple, other that to ask you again to read all the indexes for Alaska, and for CA. Some of the indexes are lower in CA (grocery index, utilities, transportation, health, and misc.) than in Alaska, and these keep the cost of living lower in CA, even if its housing index is higher.
b. In Alaska the grocery index is higher, and so utilities, transportation, health, and misc. You have to take into consideration all the indexes for each State, not just one or two of them.
ALASKA
Quote:
Cost of Living Index: 131.8
Grocery Index: 128.4
Housing Index: 147
Utilities Index: 161.7
Transportation Index: 115
Health Index: 144.8
Misc.: 116.8
Quote:
6. California
Cost of Living Index: 127.1
Grocery Index: 113.6
Housing Index: 176.7
Utilities Index: 113.6
Transportation Index: 111.1
Health Index: 109.7
Misc.: 106.2
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