Saturday, October 15, 2011

Cost of Living

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It is a well known fact that Kotzebue is the most expensive hub community in Alaska.

"The Alaska Geographic Differential
Study contains cost information
from 18 sample blocks throughout
Alaska and covers housing, food,
transportation, clothing, and medical
care. The study lists cost differentials
for expenditure categories in
all locations. Kotzebue was the most
expensive community, with costs 61
percent higher than in Anchorage,
the base community."
http://laborstats.alaska.gov/col/col.pdf

There are a number of reasons for this. One of them is that you cannot drive from here to anywhere else with a car or truck. Everything we have here is either flown in or barged in. Everything. We only get a few barges a year because our shipping season is short. Kotzebue Sound is very shallow, so the big barges have to park 14 miles out and the cargo is lightered into Kotzebue by tugs pushing shallow draft barges. It takes many loads and a lot of gas to bring a huge barge worth of stuff into Kotzebue.

As far as groceries are concerned there are other reasons they are so expensive. We have two grocery stores. One is called Rotman's. It is a small locally owned store that has a limited selection of groceries and other goods. And while Rotman's is also fairly expensive it doesn't burn your but so much when you consider that they are locally owned and fairly small which usually means things are not gonna be cheap.

The largest store is Alaska Commercial Company (AC) which is a Canadian owned company with many stores across bush Alaska. They offer large variety of groceries and "fresh" produce as well as dry goods, clothing etc. AC is the most convenient place to go when you want to get everything you need in one place right now. It is also amazingly expensive. Most things are double the cost of the same item in Anchorage....and some things are triple.

There are a number of reasons AC is so expensive. One reason is the price of freight. It cost a lot of money to get stuff here. Another is the fact that AC pays an obscene amount of money to Kikitagruk Inupait COrporation (KIC). I don't remember the exact amount I was told but I think it might have been around $30,000 a month. KIC is the largest apartment rental as well with a notorious reputation of being VERY expensive. They can be, they own many of the available rentals here in Kotzebue. And then you have to HEAT that big old building with stove oil that costs almost $7 a gallon.

Another reason why AC charges such high prices, and the reason I believe pisses people off the most, is because AC knows they can. They know that no matter how much they charge, enough people will continue to buy stuff there. They are available and convenient and people will buy that expensive stuff for that reason alone.

I try to do as much shopping as possible outside of Kotzebue. I shop as much as I can when I am in ANC, or other places, especially for frozen foods, and bring it back as baggage. No matter where I go, I go grocery shopping and bring back as much stuff as possible. I fill every nook and cranny of my baggage with stuff we need and want. When flying to Kotzebue from Anchorage you can have three 50lb checked bags for free and two carry ons. Sometimes my carry on suitcase weighs 50lbs. Seriously. I am going to be really depressed of Alaska airlines puts a weight limit on carry ons.

I order dry and canned groceries and laundry soap from Amazon.com and take advantage of their super saver shipping. You can find some really good deals there. I make Span Alaska barge orders once a year, and we eat a lot of locally caught meat and fish. I haven't bought stuff like certain non perishable groceries, toilet paper, laundry soap, shampoo/conditioner, or dog food in Kotzebue for years. If you are careful and plan ahead it is possible to greatly reduce the amount of money you have to pay for food and other necessary items. That's not to say that you never see me in AC...but I do not do most of my shopping there.

Anyway, the whole reason I started writing about this was because of Uyaana's math project. He has to do a comparison chart. Since we are heading to Anchorage for a few days on Monday he decided he wanted to to a price comparison on groceries and other necessities. So today we went to AC and made a list of 40 common items and their prices. Right now he is typing them into a chart. When we go to Anchorage we will go to Walmart and Carrs/Safeway and write the prices of the exact same items from each store. When he is done with the project I will take a photo of the chart and post it here so you can see the results. Until then here are a few photos of the prices at AC.

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17 comments:

christine said...

reminds me of bethel and not in a good way. I once had a carryon that weighed 70# (full of meat and cheese).

Miz Liz said...

Oh My Word!!!! I'm glad you explained why it is so expensive, I bought a gallon of milk today 4.89, dozen eggs 1.89, flavored coffee creamers 2.89 Big Difference between your place and mine (Florida)
I'm looking forward to the food chart.

gramma2many said...

It reminds me of the sticker shock I had 40 years ago when I moved to Anchorage.

Anonymous said...

UHM...I think Barrow is more expensive. Of everything you've shown, not one item is more expensive than what AC charges here.

Cathy said...

You must be catching us up.

Gloria said...

Oh my! I guess I would be quite skinny if I lived there! lol

Rachel said...

Holy crap! And I thought groceries here in Southern California were expensive. The prices where you are - that's just madness.

Anonymous said...

Dont forget the City Sales tax that is added on top of your outragious prices. I used live in Kotzebue, I couldnt afford to move back. Normally when I go up for a visit, my sister has me buy a bunch of groceries for us to cook while I am home. Then we only have a few items to buy like eggs. My sister travels alot, and buys what she can on her travels also. Especially when she is Anchorage, since I can drive her around

Peruby said...

Please excuse my language but that is nuckin' futz! I am shocked.

Finnskimo said...

When did Milk go down? The last price I have on milk is $11.59, plus 6% tax... Yay, ten BUCKS! :)

Cathy said...

Milk went down when they switched tro the Kirkland brand a couple weeks ago.

Anonymous said...

WOW What a reality check for us in the lower 48!

Kathy said...

OMG, I sure hope Alaska Airlines doesn't limit your baggage either, like they do "outside"!!
Even though I've been to Alaska 4 times and knew the high cost of food, Kotzebue gets the prize for the most expensive area!
That must be so hard to make ends meet for every family up there!
Can't wait to see your son's comparison chart!

NCL said...

Your son's homework assignment will be so interesting for us to see. Tell him it's a great idea that will be appreciated and enjoyed by a lot of people.

alaskapi said...

Has anyone in Kotzebue looked at developing a food co-op? Perhaps in concert or with the help of your locally owned market?
One of the good things is that more of everyone's food money would stay at home in wages and so on to re-circulate in the community rather than flow out of small-community Alaska at the rate it does most places.
If you have/had enough committed members it is also possible to bulk buy at lower rates you can pass onto yourselves.
I shopped at /was a member at the Arcata Co-op when I attended university.
http://www.northcoastco-op.com/about.htm
It looks like they have expanded quite a bit since then.

Anonymous said...

You prices are about triple to Chicago land prices...a few things a bit more..+ our sales tax of 8 to 6 percent depending on where you live. Have fun be safe on your trip! Cama

Kathleen Taylor said...

Wow- I knew that goods were higher priced in Alaska, but I didn't KNOW.