Borough talks budget, DNR land claims rejection


Illustration Courtesy City and Borough of Wrangell

The above illustration shows land requested by the City and Borough of Wrangell from the Alaska Department of Natural Resources near Thom’s Place. The DNR has denied a number of the city’s claims for additional property.

The Borough Assembly held a public hearing regarding the draft form of the 2013-14 Fiscal Year budget for the city on Tuesday, May 14 at City Hall, taking testimony from two citizens.

Cyni Waddington, the manager of the Wrangell Chamber of Commerce spoke first in support of the budget, adding that her organization relies on funding from the city to survive.

“Speaking on behalf of the Chamber of Commerce, in regard to the amount that is provided to us, we absolutely need that money,” Waddington said. “It’s a necessity to the Chamber’s well being.”

Wrangellite Julie Decker spoke next – and communicated her concerns over a ballot initiative set for October that could see the sales tax rate in Wrangell drop from 7 percent to 5.5 percent.

“I want to say that the city looks like it’s in a pretty good position as far as reserves. I think that’s a first glance look at where the initiative is coming from,” Decker said. “However, we are just starting to grow as a community. We’re starting to see that in actual numbers of population. We’re seeing it in projects around town that we have worked on for decades in some cases. I feel like a cut in operating costs … is not a good thing.”

According to data released by Borough Finance Director Jeff Jabusch, a reduction in the sales tax would require a budgetary downturn of nearly $425,000 – with the school district losing $196,947 in funding, and the Chamber of Commerce losing $25,000 in the process. Other items that would be cut include Fourth of July fireworks, a lobbyist for the city, and support for the senior citizen program.

The elimination of tax-free days and an increase in the mill rate would also be on the table if the reduction passes, according to Jabusch.

The issue of land entitlement in the Borough was one of the main issues tackled in Borough Manager Tim Rooney’s report to the Assembly during the regular portion of the meeting.

The Borough had requested several parcels of land it identified as important to the economic development and use of the citizens of Wrangell in their land request to the Department of Natural Resources.

A number of those claims were rejected by the State.

“As communicated in the April 5, 2013 Borough Manager's report, the City and Borough of Wrangell was notified in early April by Ms. Sandra Swanger-Jensen, Municipal Entitlement Manager for the Department of Natural Resources that several land parcels identified by the City and Borough of Wrangell for land selection had been rejected. (Carol) Rushmore and I reviewed the comments and responded to Ms. Swanger-Jensen on April 30, 2013, prior to the May 1, 2013 deadline established by DNR … The process now requires DNR to review the response and the Final Finding and Decision will be issued. Please note that the FFD can also be appealed by the City and Borough of Wrangell.”

According to a memo from Rooney to DNR, the city is protesting five complete and partial rejections of land entitlement claims – two sites at Thom’s Place, and one site each at St. John’s Harbor, Pat’s Creek and on the Bradfield Canal.

In the memo, Rooney questions the value of the State of Alaska’s retention of lands in Southeast for its land sale disposal program.

“The City and Borough of Wrangell objects to the rejection of the 199.59 acres in (Thom’s Place) for the State of Alaska to retain for support of their own land disposal program. DNR acknowledges that there is little land in southeast Alaska for this purpose (and) is retaining a total of approximately 900 acres in the Wrangell area (Thoms, Pat Creek/Eastern Passage and St. Johns), of prime developable land. Why is the State's interest in providing land disposal opportunities a better public interest than that of the Borough's?”

Rooney then went on to state his belief that the needs of Wrangell’s citizens should outweigh the desires of the State.

“The Borough would argue that our ability to have quality land available for development purposes based on the needs and requirements of the public and Borough residents outweighs that of the State,” he wrote. “The Borough of Wrangell (or previously the City of Wrangell) was unaware that the State was ever considering land disposal in the Thom’s Place area in addition to the previously completed land sales at that location. If the City (and Borough) of Wrangell was previously notified of this intent by the State of Alaska, please provide a copy of that notification.”

In his report, Rooney also raised the issue of the city budget as of the end of last month.

“At the April 23, 2013 regular meeting of the Borough Assembly, Assemblyman (James) Stough asked that I provide an operating budget and financial report regarding budget standings to the Borough Assembly,” Rooney wrote, continuing, “The (report) provides a summary of the revenues and expenditures through the month of April 2013. This report should be used only as a general indicator and not as an exact hard number of the financial status as of April 30, 2013. There is a very long detailed process that Mr. Jabusch completes at the end of the fiscal year to do all of the necessary year-end accruals, adjustments, grant requirements and other work so the year end numbers reflect an exact balance.”

The summary provided to the Assembly by Jabusch shows a year-to-date budgetary expenditure of just over $4.197 million, with revenue of $5.182 million as of April 30. That amount reflects a 76-percent “on-target” rate of spending, according to Jabusch.

The fiscal year for Wrangell begins on July 1 of each year.

Rooney also had good news regarding the Borough’s permanent fund, which is based on Timber sale tax relief to communities in Southeast, produces money for use in the Borough to supplement city operations. It can also be as a slush fund to pay for infrastructure projects on a loaned-cash basis.

“The balance in the permanent fund account with Morgan Stanley as of the end of April was $6,580,125,” he stated. “That is an increase in the current fiscal year of $558,650, through 10 months. This will end the year a little less because of the annual transfer of $250,000 to come from this account. Nevertheless, this is a good year for this fund.”

He added that the fund has accomplished the goals that it was originally planned for. Starting at $5,000,000 in 1999, the fund has continued to grow despite annual transfers of $250,000 to the Borough’s general fund. Additionally, there were two occasions when large cash amounts were taken from this fund to match grants for a travel lift and belt freezer.

The Wrangell Medical Center replacement project was also on Rooney’s lsit of topics presented.

“(CEO) Marla Sanger and I visited with Mr. Keith Perkins with USDA on Friday, May 10, 2013 in Sitka in order to review the reapplication process to obtain the USDA loan commitment,” Rooney stated. “In addition to that process, discussions were also held regarding the needed activities for the Wrangell Medical Center and the City and Borough of Wrangell to take in ‘lock step’ moving forward in support of the loan application. The entire project team – American Health Facilities Development, Layton Construction, David E. Johnson Architects, and Sanderling Construction, along with the City and Borough of Wrangell and the Wrangell Medical Center – are currently in the process of scheduling a visit to Wrangell along with (Perkins.) The purpose of the meeting would be for the current WMC Board and Borough Assembly to be brought up-to-date.”

The Assembly also approved a land swap between the city and Brett Woodbury. The city will acquire two lots with utilities and access routes in return for a vacant lot currently owned by the Borough.

The next meeting of the Assembly is scheduled for May 28 at 7 p.m.


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