This is the second in a series of stories about how Gov. Mike Dunleav’s vetoes will affect Haines residents.
After the statewide Power Cost Equalization (PCE) subsidy was defunded starting July 1, customers of Alaska Power and Telephone (AP&T) can expect minimal cost increases, while customers of Inside Passage Electric Cooperative (IPEC) may experience substantially higher bills starting next month, depending on the State Legislature.
The PCE aims to equalize energy costs between rural and urban communities. As a subsidy from the state of Alaska, PCE applies credits to the bills of both residents and community facilities served by eligible utilities.
IPEC residential customers, Klukwan residents and people living between 10 Mile Haines Highway and the border, can expect a 33.8 cents increase per kilowatt hour starting next month, according to CEO and general manager Jodi Mitchell. For those using 500 kWh per month, this increase would be $169 per month.
“If costs go up, it will take food from my kids’ stomach,” said Felicia Strong, mother of four living in Klukwan. “A lot of people in Klukwan are elders or living on fixed incomes.”
In addition to residential customers, many community buildings receive funding from PCE including the Jilkaat Kwaan Heritage Center (JKHC). Last month JKHC received $4,559 of credits from PCE on their electricity bill, said tribal administrator Brian Willard. Without renewed PCE funding, JKHC’s monthly electric bills could climb to over $10,000 per month, said Willard.
“We are going to be adversely affected if the PCE sweep is not brought back,” said Klukwan’s village council president Kim Strong. “This will be a significant blow to the success of the Heritage Center.”
AP&T residential customers (Haines area) can expect a 1.73 cent increase per kilowatt hour (kWh) this month, according to their online tariff book. Those using 500 kWh can expect an increase of $8.65 per month.
PCE lost funding during an annual accounting trick called the “sweep.” Every July 1, the state transfers funds from various state accounts (including that of PCE) to one large savings account. The “reverse sweep” usually occurs seconds later when funds are transferred back into the state accounts. While the “sweep” is constitutionally mandated, the “reverse sweep” must be passed by legislature. This year, the “reverse sweep” never happened.
When IPEC customers receive their July bill, it will be normal. IPEC chose to swallow the extra cost. “We are taking the risk that a funding source will be identified,” Mitchell said. If a source is not identified, IPEC plans to pass the extra cost on to customers and look for other funding sources to subsidize the high cost of power, said Mitchell.
All IPEC customers in Klukwan and the upper Chilkat Valley combined stand to spend an extra $21,306 per month, said Mitchell.
Looking forward, the House Finance Committee is currently reviewing an amended version of HB2001 which includes a “reverse sweep” that would return funds to state accounts including PCE.
Avalanche Center braces for budget cuts
The Haines Avalanche Center (HAC) anticipates a 50 percent budget cut that may limit its educational and forecasting services this winter, according to director Erik Stevens.
“It’s a perfect storm,” Stevens said.
Two of HAC’s primary funding sources—the Haines Borough and the Alaska Department of Public Safety—anticipate limited budgets due to state budget cuts. HAC relies upon a patchwork of other funding sources, many of which are vulnerable to the state budget crisis and are granted in the fall, said Stevens.
HAC approaches this winter without its usual buffer, due in part to the Haines Borough Assembly’s 62.5 percent reduction in funding to the center this year. HAC’s formal budget request to the assembly was declined due to the ongoing budget crisis, said Stevens.
HAC provides a variety of forecasting and educational services throughout the winter; including online snow forecasts issued three to five times per week, free avalanche awareness courses and accredited avalanche certification courses.
“Our main goal is not just public safety but enabling people to go out into the mountains,” Stevens said. Last winter 19,000 people used HAC’s forecasting website and 103 students benefited from 10 free avalanche awareness courses, he said.
“We check the forecast every morning before an outing with our family,” said resident skier Adam McMahan. “Without safe access to the backcountry for our kids, it would be difficult for us to recreate in Haines in the winter,” Emily McMahan said.
Stevens expects that the budget cuts will impact both the availability and quality of HAC’s services. Without more funding, HAC anticipates that all three paid staff will revert to volunteer mode. HAC may limit forecasts to one per week and reduce courses, he said.
Though the program was launched by volunteers, “it is not a sustainable way to run a center,” said Stevens.
Many avalanche centers in the Lower 48 receive consistent funding from the U.S. Forest Service, said Stevens. In Alaska most winter recreation occurs on state land. While Alaska law requires the Department of Public Safety to develop and implement a statewide system, it does not exist.
To grapple with this lack of state support, other communities such as Cordova include avalanche funding as a line item in their city budgets.
Looking forward, HAC will continue pursuing funding sources including a non-profit funding request to the Borough Assembly, said Stevens.
“We’ll hibernate if we have to hibernate,” said Stevens, but “we’ll all still be here.”