Tim Muth studies an electrical diagram while working on the wiring for a new home under construction in Mountain Rose Estates in Soldotna. The large development features homes for senior citizens.
Photo by M. Scott Moon
Residents of the Kenai Peninsula Borough appear to be getting rather long in the tooth. At least that's what the statisticians are saying.
An analysis appearing in the November issue of "Alaska Economic Trends," published by the Alaska Department of Labor and Workforce Development, put the median age of the borough's population at 36.7 years. However, 36.7 years is older by four years than the median age statewide.
Since 1980, the number of retirement-aged residents on the peninsula has grown steadily as a percent of the overall population, faster even than the state as a whole.
According to state economists Neal Fried and Brigitta Windisch-Cole, who authored the Trends article, the peninsula has a bigger share of the state population over 55 and a smaller share of children under 5. While the over-55 population makes up 14 percent of the whole statewide, better than 18 percent of the borough's population is in that age group.
As of July 2003, the population of the Kenai Peninsula Borough was estimated at about 51,220. The over-55 population made up 18.7 percent of that figure, or about 9,565. That's up from the 2000 census figure of 7,737, and significantly higher than the 4,527 counted in 1990. The economists suggested that part of the reason is that more aging residents are choosing to stay when they retire.
"It is also possible that a significant number from elsewhere in Alaska and even from the contiguous states are moving to the peninsula to retire," the authors said.
The reasons are varied the chance for a vigorous lifestyle, a relatively mild climate, a lower cost of living than in other parts of the state, proximity to relatives and friends, available land for homes, assorted property tax breaks, easy access to stores and businesses, abundant recreational opportunities, and a wide variety of senior services including senior housing projects in a growing number of convenient locations around the borough.
And there are reciprocal benefits from the presence of so many retirees. It turns out they're good for the borough's economy. Here's why.
Their incomes from pensions and retirement savings, annual Alaska Permanent Fund dividend checks (and until recently, Longevity Bonus checks), as well as spending coming from private medical insurance programs and government program payments from Medicare and Medicaid all flow into the borough's economy.
"Considering the future size of this retiree population in Alaska and the nation, this trend could become a growing factor and advantage for the peninsula," Fried and Windisch-Cole wrote.
This aging trend has been ongoing for a while and is expected to continue for the foreseeable future. The Alaska Commission on Aging issued a report earlier this year outlining a two-year plan for the delivery of services to seniors. In it, the commission cited a December 2000 study by McDowell Group Inc. that noted a 50.4-percent increase in the 60-and-over population statewide between 1990 and 2000. Meanwhile, U.S. Bureau of Census figures predict that seniors as a percent of Alaska's over-60 population will rise from 8 percent (50,600) in 1999 to 20 percent (165,000) in 2025.
And at least for now, most aren't going anywhere. The commission estimated 92 percent of Alaska seniors could be expected to stay in Alaska indefinitely.
The commission concluded that Alaska's seniors represented "one of the largest single sources of money flowing into the state." Specifically, such things as retirement income and payments from medical programs "have a significant beneficial effect on the state's economy," the commission reported.
There's a sobering flip side to that rosy picture, however. The commission also concluded that more than half of Alaska's seniors live "precariously on the edge" of insolvency. About half of senior households are thought to fall below U.S. Housing and Urban Development low-income standards for Alaska.
In response, some seniors might choose to leave Alaska. For others, however, financial benefits from the state and municipal governments will prove critical to their well-being and be a strong inducement for staying put.
The McDowell Group recommended strengthening the state's network of services for seniors and expanding its capacity. Some of those services would have to be publicly funded.
Bill "Hutch" Hutchinson of Freedom Reality talks about how homes in Mountain Rose Estates are designed with senior citizens in mind.
Photo by M. Scott Moon
On the other hand, the research group noted that seniors create economic and business opportunities, and their income and medical payments would "create billions of dollars in economic impacts statewide."
Among the commission's findings were:
Retirement benefits and medical payments to Alaskans over 60 result in an overall economic impact of about $2.4 billion a year.
As volunteers, seniors may provide the equivalent of 2,400 full-time jobs worth $60 million a year.
As unpaid caregivers, they may provide as much as 6,300 full-time jobs.
Among the sectors feeling the effects of a growing population of retirees is the senior housing industry. The Kenai Peninsula has several such facilities that often are filled or nearly filled to capacity. For example, take the experience of Fred Lau, administrator of Homer Senior Citizens Inc.
Several years ago, the corporation built an assisted living complex licensed to serve up to 40 residents. Today it serves 37.
"For years we had a problem filling it up," Lau said. "We will now be at capacity fairly quick."
The corporation built a 24-unit independent living apartment complex in 1983 and added eight more units in 2002. All 32 units are occupied.
"We have more than 40 on the waiting list," Lau said.
Lau's Homer statistics indicated that the Kachemak Bay area, at least, is attractive to retirees from other states.
"We have a fair number of people that are coming from Outside the state in the assisted-living facility," he said. "I just brought my mother up."
Many Alaskans have come or are expressing interest in the Homer independent-living complex, he said. Others are moving to the lower peninsula and buying or building new homes, completely independent of the corporation's facilities, he added. Meanwhile, it appears many seniors who have lived their lives in the area are staying after retirement, Lau added.
The peninsula's milder climate was the draw for him, after spending part of his life in Fairbanks.
"This is kind of like the banana belt (of Alaska). Although yesterday we got 18 inches of snow," Lau said a day after the Dec. 14 snowstorm.
Lau said a growing older population is straining available service delivery systems.
"There is a real need for increases in services," he said.
Dennis Murray, director of the Heritage Place nursing facility in Soldotna, said seniors once opted to leave the state at retirement. Today, seniors stay for the favorable economics and to take advantage of a variety of services.
"Alaska, as a state, has done a great deal to provide services for the senior population disproportionate to other states," Murray said.
Many also choose to remain because their children and grandchildren are making their lives here. In some cases, Alaskans are bringing aging parents to Alaska from Outside, where some, along with their Alaska counterparts, are taking up residence at senior facilities around the state.
"Families are making a conscious choice," Murray said.
Mark Romick, a planner with the Alaska Housing Finance Corp., said the natural evolution of baby boomers moving up the senior ladder would produce a growth in demand for senior housing.
Citing a market study done for the Kenai Peninsula Borough in 2001, Romick said there was a demand for 103 units of senior housing of all types (independent living, assisted living and long-term care) in 2001. That study predicted a 45-percent growth in demand by 2006 when some 186 units would be needed.
Homer's recent addition of eight units to its independent living facility (bringing the total to today's 32), 10 units nearing completion in Sterling, and six units planned for Cooper Landing (all AHFC supported) are indications of the response to that growing demand, he said.
That doesn't take into account the numbers of seniors who remain at home.
Indeed, Romick said, Alaska seniors as a whole don't move to seniors-only housing as early in their lives as their counterparts outside.
"The average age in seniors-only housing is higher here than Outside," he said.
Why may have a lot to do with how steadfastly they cling to an independent lifestyle, the fact that many enjoy the support of their children, and the sizes of their incomes, he suggested.
Even with that in mind, however, Romick said the state as a whole will face challenges as the baby-boomer bubble begins to retire en mass and needs senior facilities. Among those challenges will be the rising cost of constructing those facilities.
"If we assume that the senior population is growing as the baby-boomer generation becomes older, the demand will increase," Romick said.
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