Borough reaches out to CIA to purchase museum building
March 18, 2021
One avenue the Haines Borough is exploring, as the Haines Sheldon Museum board of trustees works to restructure as a separate nonprofit, is the possibility of selling the museum building to the Chilkoot Indian Association (CIA).
“It’s been on the back burner until we got the PERS termination study results. Now that we have those numbers, we’re reaching out to CIA to see their interest,” Mayor Douglas Olerud said in an interview Monday. He said the borough’s last conversation with CIA was in January, prior to the study’s completion.
Based on the report, which was finalized earlier this month, chief fiscal officer Jila Stuart estimates the borough will remain on the hook for roughly $500,000 over the next 18 years if the board of trustees moves forward with the plan to turn the institution into a nonprofit, completely separate from the borough.
Olerud said the borough’s hope is that selling the building to CIA would help offset that cost. “The money we’d be getting for the museum would probably be covering that liability, which we have to pay regardless of what happens,” he said, adding that the public will have an opportunity to comment before any decision is finalized.
CIA representatives didn’t respond to requests for comment by press time.
Discussion of museum separation is currently before the assembly’s Government Affairs and Services (GAS) Committee, but the issue hasn’t been discussed in recent months.
“I think there’s work going on with CIA and the museum board of trustees, and so we’re just waiting for a more formal proposal on that transition, and then we’ll take it to the assembly,” chair Cheryl Stickler said.
At a March 12 museum board meeting, trustees expressed confusion about the lack of discussion of the PERS termination study during the most recent assembly meeting. “Right now, things are just in limbo,” board president Kelleen Adams said.
The lack of clarity will present challenges for the board and borough as work begins on the budget for the upcoming fiscal year (FY22).
“The nonprofit board is coming up with two separate budget proposals since we don’t know if the museum is going to be an audit component of the borough, and we don’t know if it’s going to be separate from the borough,” interim museum accountant Burl Sheldon said. “Either way, funds for museum payroll would continue to be largely a borough obligation.”
Sheldon said some differences between the draft budgets are costs if museum employees remain borough employees, like health insurance and PERS, and also differences like the creation of new positions if the museum separates. He said it will be up to the board to make the final call on budget details.
Prior to the current fiscal year, the borough had routinely budgeted roughly $220,000 to cover museum payroll and building maintenance. In the current fiscal year (FY21), the borough reduced funding for the museum to $180,000, including $161,000 for payroll costs.
At the March 12 meeting, Sheldon said the museum, operating with a skeleton crew, has hardly touched the money allocated for payroll. He said the museum had spent roughly $24,000 in borough funds on payroll, thanks to grant money, the elimination of the museum director position last summer and another museum employee who left in the fall. Sheldon recommended the board ask that a portion of payroll funds be reassigned to pad the museum’s operating budget in anticipation of another summer with scant revenue. The board agreed to take the proposal to the borough.
The board of trustees is trying to transition the museum from being a quasi-governmental organization, with attributes of both a borough department and nonprofit, to a completely separate nonprofit. The plan involves changing municipal code and museum bylaws to reflect the facility’s independence from the borough, and transitioning staff from borough employees to nonprofit employees.
Trustees have said ideally, under the new structure, the borough would remain responsible for maintenance of the building and would continue to provide financial support for the museum at a reduced level agreed upon in a memorandum of understanding. In past interviews both trustees and state museum experts have said it’s likely borough funding for the museum will decrease if the institution separates from the borough.