Borough clerk Mike Denker speaks during the April 22, 2025 assembly meeting. (Will Steinfeld/Chilkat Valley News)

Community Purpose (Property Tax) Exemptions

It’s been a contentious start to budget season already, with back and forth debate on non-profit funding spread across many of the last few assembly meetings. That debate was, at least in part, renewed Tuesday night, this time on the issue of Community Purpose Tax Exemptions.

That property tax exemption, according to borough code, exempts non-profit land used exclusively for “community purposes.” That includes property like the American Bald Eagle Foundation’s natural history museum, or community-use green spaces. On the other hand, property like Dalton City, which is owned by the nonprofit Southeast Alaska State Fair but also collects rent from commercial tenants, is generally not eligible. 

Meeting this standard was not cut and dried, with applications for five properties from three organizations not recommended for exemption by property assessor Martins Onskulis of Appraisal Company of Alaska. 

Three of those properties are owned by Takshanuk Watershed Council (TWC), which did have an exemption approved for their Jones Point property. According to TWC executive director Derek Poinsette, all of the denied properties had been exempted for the past two decades.

Onskulis wrote in his report that these were “empty lots” with no community purpose. TWC, however, described them as land with simple trails used for youth education and recreation that are “always open to the public.” 

The other two properties denied by Onskulis were the site of the under-construction Haines Friends of Recycling facility and the Haines Senior Village. The future recycling facility was denied because exemptions are not granted for future use. In its current incomplete state of construction, according to Onskulis, the land has no community use. As for the Senior Village, Onskulis wrote in his report that because only two of the units are designated affordable, the village is “primarily a conventional housing project.”

There was some initial debate among assembly members over the merits of the individual organizations. Assembly member Mark Smith said that, continuing with his stated project of cutting down on discretionary spending, he was “drawing the line” and advocating for not granting any exemptions. 

But while Smith pointed to the total sum of the exemption as lost revenue for the borough, other assembly members framed it as vital support for local organizations. 

Assembly member Cheryl Stickler, who also described herself as a fiscal conservative, said tax money was something “appropriated to fund things our community wants,” and the list of exempt organizations “represented a wide swath of our community members.” 

That debate got cut short before it got further into the weeds. 

Assembly member Richard Clement and borough financial officer Jila Stuart pointed out that by code, the assembly was meant to “spatially apportion” land for exemption. In other words, if only a portion of a property met the standard for exemption, that square footage could be made exempt apart from the rest of the land. 

In light of this, the assembly voted to postpone granting exemptions so it could first do a GIS analysis of each qualifying property. 

Clement described it as a more “quantitative” analysis, but it does not seem likely to reduce any of the disagreement. Even after the GIS analysis, the assembly will still have to make judgment calls on what qualifies as a “community purpose” and what does not.

In other property tax news, assessment appeals are in, and there look to be a significant number to sort out. According to interim manager Alekka Fullerton, 30 of 68 property tax appeals remain unresolved, and will begin to be heard at the first Board of Equalization meeting on May 12. 

Road Improvements

Sandwiched on either end by quiet, procedural, assembly business, tempers briefly flared in the assembly chambers Tuesday night over, of all things, road maintenance. 

The tension peaked with mayor Tom Morphet slamming his gavel down multiple times to regain order, and an audience member telling Morphet, “what are you going to do, kick me out?”

That was after member of the public Michael Binkie very civilly asked to give comment outside of the public comment window, and Morphet, also civilly, noted that the public comment window had passed. 

After the hullabaloo died down, Binkie gave his comment, speaking in support of a request for assembly action submitted by Don Turner Jr. signed by more than 100 other members of the public. Turner’s submission petitioned to make road maintenance the “number one priority for the Public Works Department” and asked for “detailed time cards for public works [employees].” 

Public comment from Turner, Tim Ward and Binkie described borough employees that were under-trained and under-qualified on maintenance machinery and techniques. 

“We have guys that aren’t qualified to be running some of the equipment they’re running,” Ward said. “Don Turner Jr. has given his time to get them up to speed … these guys need to come to work ready to get to work.”

Multiple assembly members did their best to cool the fire, and outside of Morphet’s exchange, the tone on the dais was far more measured. Kevin Forster and Gabe Thomas noted a specific sticking point, that once borough employees were well-trained and high-performing, they were likely to be offered higher salaries for the same work by private contractors. 

Turner presented his concerns to the Government Affairs and Services Committee on April 1, and Forster said that since then, many of Turner’s top concerns had been addressed, including releasing a public maintenance schedule and work on several of what Turner had marked as the highest priority roads. 

Turner, however, said the maintenance plan scheduled work too late, and had “no talk of grading or adding topping.”

As for time cards, interim borough manager Alekka Fullerton said they were already in the works. 

“Mr. Turner is now agreeing that we just need to use City Works,” Fullerton said. “We have the resources to track all of this – I believe we are – and I have no problem redoubling our efforts to use [borough administrative software] City Works.” 

Fullerton also noted that her proposed budget for the upcoming year includes funding for equipment-operator training.

It also seemed that part of the debate was driving at a broader question of possible privatization. The idea of outsourcing road maintenance to private contractors was brought up by Thomas, and assembly member Smith added support for using private citizens, who Smith said would do it for free or very low rates, to train borough employees. 

Binkie closed his public comment by saying he was “a strong proponent of contract grading, because you get people out there who know what they’re doing.”

Debra Schnabel also gave public comment on the issue, criticizing Turner’s petition. 

Schnabel said she had spoken with multiple people who had signed the petition, who she said felt strong-armed to sign, or misled about the contents of the petition. 

Schnabel also said that Turner was continuing a pattern of treating borough maintenance staff poorly. 

Turner responded that he had not strong-armed anyone to sign it, and that “most [signatories] read it at length.” 

Sales Tax Indicators

Five years out from the start of the pandemic, trends are starting to emerge about what has returned to an old normal and what has remained changed. 

Borough sales tax numbers are out, and they’re a window into where spending is happening. 

Of all sectors, tourism, of course, saw the biggest drop in 2020, plummeting to around one-sixth of pre-pandemic levels. 

Tourism sales tax numbers – including tours, charters, and transportation – were back up to those 2019 totals by 2022, not factoring in inflation. Now, with two more years of data, tourism sales tax looks to be back to growing at a pre-pandemic rate, adding about 10% per year.

Something that certainly does not look to be returning to pre-pandemic levels is the online and remote sales tax. That number was just a sliver of total sales tax revenue in 2019, by far the smallest individual area of sales tax revenue. But in 2020, it grew 124%. In 2021, it added another 71% on top of that. And now, it only continues to grow. In 2024, online and remote sales tax was the third biggest sales tax revenue stream, trailing only tourism and retail.

Most other sectors are relatively stable at the moment, though construction sales tax revenue saw a 16% drop in 2024. 

Fish Tax Revenue Sharing

The Alaska Senate Finance Committee in Juneau is discussing a proposal to increase revenue sharing from the fishery resource landing tax, and the borough assembly has decided to lend its support. 

The fishery resource landing tax is levied on the local fleet based in Haines, and it’s seen as a way for the state and municipalities to get a share of natural resource revenue, even when the catch might be exported and sold elsewhere. 

The state is currently passing 50% of the tax back to the municipalities where it was collected. That’s been a significant windfall for the borough, which says it collects almost $500,000 annually from the revenue sharing. 

The new proposal would raise the rate to 60%, which the borough resolution says is a necessary “buffer” for instability and declines in the global seafood market. 

According to the senate bill, the revenue from the tax is meant to be earmarked for harbor facility improvements.

Mining issues sneak onstage

Near the end of the meeting, the borough took up a seemingly unremarkable motion to support the Southeast Conference’s economic development plan.  

“They asked us to endorse it. I didn’t see anything there too objectionable,” Morphet said. The borough is a member of the conference, and Morphet described the endorsement as “pro forma” — a Latin phrase defined as “as a matter of form or politeness.” 

But during discussion on the issue, assembly member Clement pointed out that the plan does extend general support to “[increasing] access to minerals and energy sources for mining on state and federal lands.”

It wasn’t that Clement opposed mining. In fact, it was somewhere in the realm of the opposite: he was opposing opposition to mining.

“If we vote in favor of this,” Clement said, “it gives further ammunition to the radical environmentalists we have in this valley that say the borough is in cahoots with mining interests.”

After Morphet said that “rational people” would see the development plan as broadly general and not precluding detailed discussions about the Constantine mine, Clement fired back: “I don’t think we’re dealing with rational people.”

The motion to support the plan was eventually approved, with Clement and Mark Smith voting against. 

Other Business

Borough clerk Mike Denker says that the consultant on the police chief hire has given the go-ahead for top candidate Jimmy Yoakum. 

Denker was full of praise, saying that he personally “absolutely loves talking to [Yoakum].” Yoakum will now be scheduling a trip to visit town with his wife, but not before May 16. That’s when his youth sports coaching season ends, and Denker said Yoakum did not want to hang his athletes out to dry by leaving town during the season.

There was also some controversy over the borough’s new agreement with Alaska State Parks to reopen Portage Cove to camping. 

Tourism director Reba Hylton said a directive from the governor, through regional superintendent Preston Kroes, seeks to limit per-night camping fees to $10. There was universal agreement on the assembly that that figure was too low. The borough, multiple assembly members said, should be charging enough to break even. 

Interim manager Fullerton advised they could go ahead and do that: by her reading, the agreement with the state says nothing about a fee limit. “I think we should go by the letter of the contract, which says we manage and charge fees and keep the fees.”

The agreement also says the borough can withdraw without penalty, so long as they provide 30 days notice.