Haines Borough lands may be on the market in the not-too-distant future. The assembly and planning commission began initial talks last week about which lands to sell to help grow the borough’s permanent fund, identifying Portage Cove, Excursion Inlet and the northeast side of Mount Riley as areas of particular interest.
During recent budget discussions, the assembly asked interim borough manager Alekka Fullerton to look at land sales as a way to bulk up the permanent fund to the point where a sustainable draw from fund earnings would be able to cover the cost of school bond debt payments.
Although the state has traditionally reimbursed a portion of school bond debt each year, for the current fiscal year, Gov. Mike Dunleavy vetoed all state funding for school debt, leaving the borough to cover the roughly $1.2 million payment.
Under borough charter, proceeds from land sales, excluding the cost of preparing the land for sale, go into the borough’s permanent fund. Borough code specifies that fund earnings can be used for borough expenses, though the withdrawal should not exceed 3.5% of the fund’s average value in recent years.
At a joint assembly-planning commission meeting on July 15, Fullerton said staff determined it would require $24 million in land sales to increase the permanent fund to a size where a 3.5% draw could cover annual school bond debt payments, which she described as “an unachievable goal.”
Fullerton said there are still a number of reasons that selling borough land is desirable: it increases the size of the permanent fund, increases property tax revenue and allows the borough to expand in a way that supports community goals.
Newly hired planning and zoning tech Libby Jacobson went through a list of borough property available for sale, excluding properties like the school and harbor. Areas with available land include the townsite, Portage Cove, the Skyline area, the northeast side of Mount Riley, out the highway, Chilkat Lake, Chilkoot Lake, across from the ferry terminal, Chilkat Acres in Swanson Harbor, and Excursion Inlet.
At the meeting, Fullerton asked members of the assembly and planning commission to state their preferences. Areas with the most interest included Riley, Excursion Inlet and waterfront property in Portage Cove, as well as lots throughout the borough that are already prepped for sale, which several members described as the “low hanging fruit.”
Members discussed the positives and negatives of development in each area. Excursion Inlet has the potential to appeal to people in Juneau, but there could be pushback to development from current residents. Waterfront property in Portage Cove has the potential for high sale value and could be used for commercial purposes, but members agreed development would require thoughtful planning. The Riley area has the potential to offer land parcels affordable for young people with fewer assets, promoting sustainable growth in the community.
Fullerton said she would compile a ranked list based on comments from those present. The assembly will discuss the topic at a meeting on July 28, including the possibility of moving forward quickly with the sale of the “low hanging fruit.”