Chilkat Valley News - Serving Haines and Klukwan, Alaska since 1966

 
 

Sales tax revenues up 1 percent in 2011

 


Haines Borough sales tax revenues increased 1 percent in 2011 compared to 2010, with retail showing the strongest gains and restaurants and bars taking the biggest hit.

The retail increase of 6 percent includes fuel sales, which Haines Chamber of Commerce President Ned Rozbicki suggested were the driving force in pushing sales tax revenues to $2.68 million, up from $2.65 million in 2010 and $2.60 million in 2009.

“Having talked to businesses, most of whom report that 2011 was not an easy year, I would suggest sales tax revenue increases can largely be attributed to the 25 percent-plus increase in fuel costs and the Klukwan disbursement, which is a one-time event that we can’t expect to see repeated,” Rozbicki said.

Klukwan, Inc. paid out a $12.6 million distribution to shareholders in late April 2011 from the company’s general income trust. Chilkat Valley residents hold about one third of shares. Sales tax revenues in May increased by more than 5 percent from 2010.

Grocery, hardware, and liquor store sales were also part of the retail category. Sales tax also increased from that pot, said Jila Stuart, chief fiscal officer for the borough.

“Although fuel sales are a significant factor in the increase in sales tax revenues from 2010 to 2011, sales tax revenues from retail sales are still slightly up in 2011, even without fuel sales factored in,” Stuart said.

Stuart said she can’t provide more precise information on tax from fuel sales because information pertaining to individual businesses is proprietary. “Fuel sales are a very significant part of the total. I can’t tell you how much, because it’s almost all Delta Western.”

Construction and tourism each showed 2 percent increases.

Lumberyard owner Chip Lende said projects such as the Chilkoot Estates subdivision and Harriett Hall supported by public money propped up business in 2011, while “private money being spent is going to smaller jobs.”

“We were busy and were up a little bit over 2010, although it’s hard to say how much of that was sales tax, because we did a fair amount with entities that didn’t pay sales tax,” Lende said.

Lende said 2008 was the height of the vacation and second-home business in Haines. Borough sales tax revenues that year totaled $2.77 million.

Sales tax decreases last year include from restaurants and bars, 11 percent; lodging, 4 percent; and services, 2 percent.

“Our loss was probably higher than the average,” said Fogcutter Bar owner Brian Lemcke. “City-wide, 11 percent didn’t surprise me a bit.”

He said the Haines economy is becoming more seasonal, and the October 2009 smoking ban in public spaces and a few new liquor licenses in town have cut into business.

“We rely on people’s disposable income, and I don’t think people have a lot of it,” he said. “There are very few people that are really working in this town, that’s part of it, and I think there’s probably a general downturn in alcohol-related things, anyway.”

Lodging saw a setback recently with closure of Thunderbird Motel.

Resident Joanne Waterman this week said business held steady at her bed and breakfast.

“It’s changing all the time, because we don’t advertise that much,” she said. “It’s true there were more Canadians down, and we have more and more returns.”

Ski shop owner Dan Egolf said heavy snows late last year boosted sales at his business.