The Haines Borough Assembly on Tuesday is set to have further discussion on proposed exponential rate increases for using Lutak Dock.
“I think it’s moving in a very positive direction,” borough manager Mark Earnest said at the assembly’s March 8 meeting. “The whole idea is to secure a stable revenue stream for existing dock operation and maintenance costs, as well as a long-term replacement and repair fund.”
The borough’s dockage rate currently has a sliding scale, from 80 cents per foot for vessels 149 feet or fewer to $2.40 per foot for those 700 feet and above. A proposed ordinance would have a flat fee of $2.50 per foot per 24-hour period.
Earnest estimated the change would double the borough’s dockage revenue.
Also under the ordinance, wharfage would increase to $7.50 per ton for general cargo, up from $2; and the rate for explosives and other hazardous cargo would rise to $20, from $8.
Earnest said he has communicated with representatives from Alaska Marine Lines about the ordinance and said he expected a few amendments for the assembly’s next meeting March 22.
Ned Rozbicki, president of the Haines Chamber of Commerce, met with Earnest last week to discuss the ordinance. Rozbicki said harbormaster Ed Barrett and five representatives of “the largest retail businesses in town” also attended the meeting.
“In the room, there was over a century’s worth of experience working with AML, meaning multiple people having worked multiple decades with AML, and the general consensus was that it was not possible to do a rate increase of any kind and not have AML pass it on to the end user, if not initially, then at least in a couple months,” Rozbicki said.
He said Earnest still was in negotiations with AML.
“What (Earnest) stressed to the group was that he felt confident that there was a ‘sweet spot’ where he could raise the rate a certain amount, and the increase would actually be absorbed by AML and not be passed on to the consumer,” Rozbicki said.
Don Reid, vice president of operations for AML, in an interview earlier this month told the Chilkat Valley News, “Whatever increase in cost we experience will ultimately be passed on to the consumer.”
Rozbicki and two other residents March 8 commented that they were concerned the new rates would force AML to pass increases on to consumers.
According to a Northern Economics study dated Feb. 11, general cargo and hazardous cargo rates in Haines have not changed since 1994.
Member Joanne Waterman said the assembly was in a tough position.
“Shame on us for not updating the tariffs in a more timely manner and keeping up with the times, (which) makes it seem like we’re just raising the prices out of character, maybe, but I just picked up some freight and I went to pay my freight bill, and it’s 64 cents a pound right now, and there’s a fuel surcharge on there of 17.5 percent,” she said.
Waterman, though, called rate adjustments “a step forward in our ability to help our own infrastructure and take care of the things that we have.”
“I still don’t think it’s the borough’s responsibility to make sure that these other commercial entities make money, without taking care of ourselves, and I really feel that that’s what (the ordinance) is doing,” she said.
Northern Economics also provided 2009 numbers that showed the dock handled 11,240 tons of general cargo and 2,214 tons of hazardous cargo that year.
“We’re very cognizant of the fact that we are going through this upgrade and expansion planning with the idea of attracting additional commerce across the Lutak Dock, so it’s imperative that we balance the need for financial stability with our ability of being able to attract additional commerce,” Earnest said.
The ordinance includes 3 percent annual rate increases, effective Jan. 1 of each year.
Rozbicki said if the rates are amended in the ordinance, there should be multiple opportunities for public comment before adoption.
“The vast majority of material going over the dock is bound for consumers… so what that essentially translates into is it’s an increased tax on consumers,” he said.