A white paper on the Lutak Dock

A special meeting last week that Haines Borough Manager Alekka Fullerton said “fractured our community” did not need to happen, she said Tuesday during the body’s regular meeting.

Last week’s meeting was called primarily to take a vote on sending a document to the federal agency providing Lutak Dock funding outlining the borough’s new plans for the dock. That means explaining the differences between a previous design and the updated design chosen by the assembly this spring, known as “Option 1.” 

At the meeting, after discussion devolved into accusations of obstruction and incompetency by multiple parties, the assembly ended in a deadlocked vote, unable to get a majority behind either approving or denying the white paper. 

Immediately following that vote, Fullerton argued that in the absence of a definitive assembly decision, she would submit the white paper regardless, following what she said was the most recent assembly guidance, their April vote selecting Option 1. That vote, she said, authorized her to move forward with the Option 1 design process, which included the white paper. 

Then, the next day, she changed course, saying submitting the white paper without assembly approval “feels bad and is not how I want to go forward.”

Two days later, on Friday, she returned to her original position and submitted the white paper. That could’ve happened originally without a meeting ever being held, she said Tuesday. 

“I unfortunately brought a resolution which did not need to be brought and I’m really very sorry I did that,” she said. “The last direction I had from the assembly was to move forward with Option 1. I did in fact do my job and submit that white paper directly to MARAD last Friday.”

The FY27 budget

Nonprofits

The assembly added $100,000 for nonprofits to the budget, which did not previously allocate any money to nonprofits. The money will come from Fund 23, which can be spent on economic development and tourism promotion. Thomas told the assembly that this amount “does no good sitting in Fund 23.” 

In the same motion, the assembly removed $50,000 in the budget for the Haines Economic Development Corporation. HEDC will be eligible for the new pot of nonprofit funding, which the assembly has not yet decided how they will distribute.

There were ideas on how to use the money, like creating an economic advisory council proposed by Forester.

“Economic development, is placemaking, is making a place attractive where people want to live,” Forester said. “I would expect that that board’s proposals of services that they would provide would be something that maybe come out of this pot,” Forester said Tuesday night. 

The assembly passed the budget 5-1 with Smith opposed.

Funding for the borough school district

Legislative funding for the Haines Borough School District is still unknown. The assembly made an amendment to the budget that would allow the borough to provide up to $192,000 in funding to HBSD in the event that the state funding does not come through later this year. Assembly members Cheryl Stickler said this would be in addition to the $2,668,000 that the school is budgeted from the borough. This is just under $200,000 less than what the school district requested. The school’s funding is still up in the air depending on if the governor vetoes school funding for the state.

“We’re not just talking about 192,000. We’re talking on top of $2.6 million,” Stickler said. The amendment passed narrowly, requiring the mayor’s vote to split the 3-3 tie. Assembly members Eben Sargent, Kevin Forester, Craig Loomis and Mayor Tom Morphet voted in favor of the amendment with Cheryl Stickler. Mark Smith and Gabe Thomas voted against it.

Severance Tax

Long-running consideration of a severance tax is now out of the assembly’s hands, and will be up to voters this fall. 

The assembly voted to approve language for the potential tax, but have decided it will go to the October ballot to be ratified. 

The proposal taxes raw materials that are extracted within the borough but sold outside — specifically gravel, sand, coal, timber, and metal ore. Proponents have pitched it as a replacement for sales tax, as the materials sold elsewhere would not be subject to borough sales tax. Revenue from the tax would in theory compensate taxpayers for use of borough services, like roads, by companies extracting the resources. 

There’s been much discussion of a payment-in-lieu of tax (PILT) — an arrangement common in the state in which companies negotiate bespoke payments with municipal governments outside of the regular tax structure. 

Some assembly members argued Tuesday having the severance tax in place would give the borough more leverage in negotiating favorable PILTs. Particularly if there was no PILT built into the tax itself, which had been the case in some drafts. 

“It significantly strengthens our negotiating position to have a clean severance tax with no pathway for a PILT,” assembly member Eben Sargent said. 

Ultimately, the assembly voted that should the severance tax pass in October, all subsequent PILTs also be ratified by the voters. 

The only vote against approving the severance tax for the ballot was Smith. Smith said his opposition was based on a belief that it is “fundamentally unconstitutional for government to take money from private property” or “to take money from things that people sell on property that they own.”