The Hoonah Incubator Project has been completed and received a 2005 Innovation Award from the National Association of Development Organizations

The Project goal was to empower low-income Hoonah residents to fully participate in the new tourism sector of the economy of the southeastern Alaskan town of approximately 800 residents, and achieve self-sufficiency by succeeding in business.

The project assisted Hoonah residents to capitalize on business opportunities that derive from Alaska's newest cruise ship destination. The project includes technical assistance, a loan fund, and mini-grants. In the first nine months, the project assisted in the startup of 10 new businesses, including a retail store, shuttle bus, janitorial service, fishing and hunting charter, and several art production businesses.

A fourth project component was the creation of a subsidiary, Arctic Spirit LLC. This retail art gallery provided hands-on management training and seasonal employment to several Hoonah residents with the goal of selling a turn-key business to employees who completed the training program. The Arctic Spirit gallery achieved exceeded sales projections in its first season while providing training to five local employees. In October of 2005 the store was sold to a new company formed by three Hoonah residents as envisioned in the original scope of work.

This project was funded by the U.S. Dept. of Health and Human Services, Administration for Children and Families, Office of Community Services.

For more information on the project please see the following news story, printed in the Capital City Weekly, Juneau Alaska.

JEDC project helps build business in Hoonah

The economy of Hoonah is cruising into a new era, rising on the tide of the new Icy Strait Point cruise ship destination. Nearly 69,000 cruise ship passengers will visit Hoonah in this inaugural season, delivered by 32 large ships, each carrying 2000 or more passengers. This new engine of economic growth is badly needed in Hoonah, which has suffered from declines in both the fishing and logging industries. But were the 860 residents of Hoonah ready for the new opportunities that were literally sailing in on the tide? Or might they need assistance in truly capitalizing on these newfound opportunities? It was this unique convergence of opportunity and need that prompted the Juneau Economic Development Council (JEDC) to develop the Hoonah Business Incubator Project. This two-year project was one-of-five such incubator projects to receive funding from the U.S. Dept. of Health & Human Services, Office of Community Services in the fall of 2003. The goal of the project is to help the low-income people of Hoonah take advantage of these new opportunities by achieving business ownership, rather than simply earning a seasonal wage in the traditionally low-paying tourism sector. This is being accomplished by assisting local entrepreneurs with technical assistance, small grants, and loans. The project is targeted to start-up businesses in the tourist industry, but all legal businesses in Hoonah can receive assistance. Mini-grants of up to $1,000 per person are intended to help with start-up or expansion costs. Equally important, the grants provide an incentive for participants to spend the time necessary to plan and develop an effective business model. Aspiring entrepreneurs in Hoonah and elsewhere typically need help with marketing and sales, to include packaging, pricing, and promotion. They often need help in defining their market, their business, and the best use of their time. JEDC technical assistance can help these entrepreneurs develop a focused business strategy, which is far more valuable than the token grant. One of the initial project participants, and the first to receive a $1,000 mini- grant, was Jacqueline Dick. In fact, Jackie, as her friends call her, had originally invited JEDC to provide help to her community.

It was this contact that indirectly led to our intensive outreach to Hoonah. Jackie is a hard- working and respected member of the community. She has been involved in several recent business start-ups and has benefited from JEDC counseling. Hoonah Janitorial and Maid Services is one of these new businesses, and one that she hopes can operate year-round. Several other Hoonah residents are pursuing arts and crafts production. These micro entrepreneurs include a doll maker, a wood carver, and a print artist. These artists have used their mini-grants to purchase tools of the trade that can increase their efficiency and, therefore, their profitability. After 30 years as an artist, Barbara Holden now has, for the first time, commercially reproduced note-cards and prints. John, the wood carver is about to purchase a band-saw, table-saw, planer, and other tools that will enable him to produce at a level that will provide a meaningful income. Paula, the doll- maker will be able to increase her output with a new sewing machine and the raw materials she purchased with her grant. A particularly proactive aspect of this project is the operation of a retail art gallery at the Icy Strait Point facility. The Arctic Spirit gallery is a JEDC effort to lead by example and provide hands-on small business management training. Five local employees are currently earning wages while they learn how to successfully run a retail business by participating in all aspects of its operation. One bonus of working at the Arctic Spirit gallery is that following the 2005 season, these employees have an option to acquire the business, either individually or collectively, for only the cost of assets. This feature represents a cutting edge of economic development practices. Business incubating is the process of helping a private business to grow. In creating Arctic Spirit, the JEDC has gone beyond incubation. It would be more appropriate to call it a business "hatchery".

Kathy Marvin and Sonya Koenig are two of the Arctic Spirit employees. Kathy has lived in Hoonah all of her life. She has two jobs, and on the side sews traditional mittens and moccasins that are displayed in the store. Kathy says, "I really enjoy working at Arctic Spirit, learning about business and meeting new and interesting people from all over the world". She adds, "I like the idea of becoming known world wide as an artist. I get many compliments on the quality of my work". Sonya Koenig is also a life long Hoonah resident. In addition to working in the Arctic Spirit store, Sonya makes cedar bark baskets. Being half Tlingit and half Eskimo, she decided on the business name Tlinkimo Baskets. The JEDC's incubator project is helping her to grow as a person. "It makes me feel so proud to walk into our shop and say, this will be ours" Sonya continues, "I am loving who I am becoming (my great grandmother, a basket weaver)".

The project is already having a positive impact, but there is more to be done. JEDC will continue to work with Hoonah residents over the off-season to help them to develop or grow businesses. There is still money for mini-grants or loans to Hoonah residents. While the intensive outreach efforts of JEDC have focused on Hoonah this year, business advise is available to all Southeast residents. The staff and board of JEDC are excited about this more proactive approach to economic development and are interested in other applied economic development opportunities. They are dedicated to diversifying our economy, assisting business development, and enriching our quality of life. Editor's Note: Readers with business ideas for their Southeast community are welcome to contact the JEDC for information about what kind of assistance might be available to them. E-mail Brian Johnson, Director of JEDC's Business Assistance Center at bjohnson@jedc.org.