Daily Sitka Sentinel

Assembly Approves Electric Rate Hike

By SHANNON HAUGLAND
Sentinel Staff Writer
    The Assembly gave final approval Tuesday night to an ordinance raising electric rates by 15 percent.
    The new rates will go into effect July 1.
    Utility Director Chris Brewton said the rate increases are needed to cover the higher-than-expected costs of the Blue Lake hydro expansion project now under way.
    But he said he is continuing to tweak the rates with the city’s consultant to make them more equitable to everyone across the board. The minimum residential bill will stay the same, at $35.
    “We were a little bit overzealous in the high and low user (categories)” Brewton said, speaking of the last round of rate increases, which went into effect last fall. “I think we’re close to getting it right. At the end of the day we have to have adequate revenue to meet the bond covenant.”
    He said he is working on the “cost of service” principle that has rate payers covering the actual cost of service.
    Assembly member Matthew Hunter commented that Sitka is getting “excellent service” for the price.
    The new rates were approved unanimously. All Assembly members were present for most of the meeting, with Phyllis Hackett and Mayor Mim McConnell participating by telephone.
    In other business involving the electric utility, the Assembly unanimously approved a new contract with the electrical workers’ union granting a 2.5 percent raise each of the next three years, beginning Jan. 1, 2013.
Marine Issues
    At a work session prior to Tuesday night’s regular meeting Shaun McFarlane, an engineer with Moffat and Nichol of Anchorage, showed a diagram for the new layout of ANB Harbor.
    The budget for rebuilding the small boat harbor will be tight, but McFarlane said he and his colleagues are “very serious” about working within the $8.5 million available.
    The money will come from the city’s harbor enterprise fund and the state harbor matching fund program, which has agreed to put in up to $4.25 million.
    The new design will add more slips for larger vessels, and reduce the number of stalls for skiffs, many of which are empty at present.
    “This will build up our inventory of larger stalls, 55 feet and above,” Harbor Master Stan Eliason said today. The new plan calls for eight 55-foot stalls, two 50-foot stalls, seven 45-foot stalls and 42 stalls 43-feet long. There will also be 26 stalls 20 feet long.
    The present configuration has eight 50-foot stalls, 29 that are 40 feet long, eight 36-foot stalls, ten 35-foot stalls and 35 that are 17 feet long for skiffs.
    “The skiff (stalls) are empty, everything else is full,” Eliason told the Assembly.
    On another maritime issue, the Assembly awarded a bid to Sitka Tours to take cruise ship passengers to and from the McGraw dock on Halibut Point Road at a cost less than the $3 per person allotted in the budget.
    Chris McGraw, manager of the private dock, rented buses from out of town for the demonstration visit of a Celebrity Cruise Line ship last fall. McGraw said he has 23 cruise ship calls lined up for this year to call at his dock, and one Disney cruise ship for 2014.
    The city has pledged to use $3 of the $5 passenger excise tax to provide cruise passenger bus service to the dock, which is five miles from downtown. Sitka Tours put in a bid of $2.81 per passenger, beating out Alaska Coach Tours, which offered a price of $3 per passenger.
    The Assembly voted 6-0 to award the bid. McConnell, owner of Shelter Cove Publishing, recused herself because Sitka Tours is a client of her business.
    On a related item, the Assembly by a close margin chose McConnell to attend the Cruise Shipping convention in Miami at city expense. She will help man Chris McGraw’s booth at the March convention.
    Pete Esquiro, the deputy mayor, went last year and volunteered to go again. Chris McGraw said Esquiro “had a significant effect” on cruise officials at the event last year.
    Mike Reif, Esquiro and Thor Christianson voted for Esquiro, while McConnell, Phyllis Hackett, Michelle Putz and Matthew Hunter supported McConnell.
    Travel, per diem and convention costs were estimated at $3,500 to $4,000. McConnell said she would combine the trip with a side trip to lobby in Washington, D.C.

Infrastructure Fund
    One of the liveliest debates of the evening was over whether to set aside money for the new infrastructure fund.
    Mike Reif and Michelle Putz sponsored the ordinance to add $658,000 to the “infrastructure repair and replacement fund.” The ordinance passed 6-1 on first reading.
    Thor Christianson cast the dissenting vote, saying the city was not yet into the budget cycle for 2013-14, and that “locking off” funds for only one purpose is bad city policy. The ordinance stated that a super majority of the Assembly would be required to spend funds from the account.
    Reif said the city needs to start thinking about its large unfunded liability, and needs to start setting aside funds to replace and repair infrastructure such as roads.
    “If you use (these funds) for operations, it will be gone,” he said.
    McConnell said she was “torn” on the issue. She said it’s a good idea to start an infrastructure fund, but felt the budget cycle in the spring would be a better time for it since all items would be up for debate. She initially said she planned to vote no, but later cast a “yes” vote.

Aquabounty Technologies
    The Assembly approved on a 7-0 vote a resolution stating the city’s opposition to AquaBounty Technologies’ application to the U.S. Food and Drug Administration to market genetically engineered salmon.
    From the public, Tonia Rioux told the Assembly that more than 100 people attended a rally on Saturday against genetically modified organics. The resolution cites threats to Alaska’s wild salmon stocks, human health and the economies of fishing communities if the product is modified without a label stating it is “genetically modified.”
    The resolution concludes with:
    “Therefore, be it resolved that the Assembly of the City and Borough of Sitka, Alaska, by this resolution opposes approval of genetically engineered salmon for sale in the United States and stands in strong opposition.”
    Matt Hunter joined the rest of the Assembly members in approving the resolution, but said he had a problem with the “whereas” clause stating that genetically modified salmon would be unsafe to eat.
    “I’d doubt we’d be able to tell any difference in a lab,” he commented.

Other Items
    On other agenda items, the Assembly:
    – approved liquor applications, and appointed Ken Fate to the Local Emergency Planning Commission, under the consent agenda.
    – authorized loans from the state for a number of drinking water and sewer replacement projects.
    – approved a grant application for $981,000 for construction of the Cross Trail intermodal pathway. Matching funds will come from a legislative grant, Sitka Trail Works, Rasmuson Foundation and the Federal Resources Advisory Committee.
    – amended a material agreement sale with S&S Contractors. The company will blast and remove rock near the Jarvis Street diesel plant. The company agrees to complete the work in exchange for more than $107,000 in lease payments owed to the city.
    – approved a $711,102 contract for Myers Power Products to provide a 12.47 kV switchgear on the Blue Lake expansion project.
    – approved a bid award for $179,960 to CBS to complete the UV facility tees piping connections.
    – approved paying $100,000 over 10 years to the U.S. Forest Service to fertilize Redoubt Lake. The agreement is part of the overall plan for mitigating the effects of inundating 362 acres of USFS land in the Blue Lake expansion project.
    – approved a $401,000 contract to CHM2Hill to provide the temporary filtration system for drinking water while the Blue Lake source is shut down for the dam project.
    – appointed Aaron Wamsley and Joseph Reeves to the Sitka Police and Fire Commission.