Daily Sitka Sentinel

Pocket Change Funds Sitka Harbor Project

By SHANNON HAUGLAND
Sentinel Staff Writer
    The quest for $5 million in matching funds for the Crescent Harbor improvement project ended successfully with a $5 amendment by Sen. Bert Stedman in the final days of the last legislative session.

The crew of the Coast Guard Cutter Bailey Barco gathers on deck during the vessel’s commissioning ceremony in Juneau in 2017. The CGC Bailey Barco is the second fast response cutter in Alaska and homeports in Ketchikan. Sitka will be homeport for a similar boat. (Coast Guard photo by Petty Officer 1st Class Jon-Paul Rios)

    The Sitka project was at the top of the list for the 50-50 matching grant program for harbors, but only $4,999,997.49 had been identified in funding from the general fund, and leftover funding from an electrical intertie project.
    “If you don’t have enough for the full amount, they go to the next project on the list,” the Republican legislator said in an interview with the Sentinel today.
    Stedman proposed an amendment adding a little more than the $2.51 needed – rounding it up to $5 – and it passed.
    The project to rebuild floats 1 through 4 in Crescent has been on the priority list on the 50-50 matching program for the past four years, Harbor Master Stan Eliason said. Some years, one or no projects have been funded. The Crescent construction project is estimated to cost $13 million.
    Eliason said he received the good news about the harbor funding from the city’s lobbyist on Monday.
    “I’m really happy it happened,” he said.
    Eliason emphasized that it’s “really early in the process,” and the project will have “a lot of public involvement.”
    Stedman said this legislative session was a marked change from last year’s, which ran into multiple special sessions. This year’s session has ended with his being more hopeful about the state’s being able to close the budget gap next year, he said. The 2019 budget was balanced by drawing $700 million from the Constitutional Budget Reserve and making a draw of $1.7 billion from the earnings reserve of the Permanent Fund.
    “The state is definitely turning the economic corner, but some of my colleagues got ahead of it in spending,” Stedman said. “We have to be a little patient.”
    A bit disheartening for Stedman was the last-minute addition of $20 million to raise the base student allocation, $6 million in pre-kindergarten education and $20 million for the Marine Highway System. He said a deal was already in place for $30 million in additional education funding in 2020, to help districts plan their next budget year before the end of the session. A total of $19.5 million was slated to go for curriculum development this year.
    “I’m kind of disappointed in the $20 million additional funding for schools; we agreed to the $30 million for fiscal year 2020, and $19.5 million for curriculum,” he said. “The trouble we have is we can’t get test scores to increase in any significant way.”
    Those opposed to the $20 million found themselves in a hard spot, because they felt they had already agreed in mid-April to curriculum funding and next year’s increase for $30 million.
    “We had to pay $46 million in ransom to get the votes to get done, without running into special session or disintegrating in the House and making the mess bigger,” Stedman said. “What it does politically is jeopardize early funding for K-12 (next year).”
    The $20 million increase in the BSA will mean $212,000 in additional funding for Sitka this year, he estimated.
    Stedman was pleased to see the passage of the Percent of Market Value approach for the Permanent Fund. The POMV uses a five-year rolling average to calculate the draw on the Permanent Fund at 5.25 percent for the next three years for state operations and dividends. The draw goes to 5 percent after that.
    Stedman said he would like to see the money split 50-50 between state government and the PFD, which would have set the PFD checks at about $2,700. The majority agreed to set the PFD at $1,600, or 36 percent of the draw.
    In the future, he said he would like to see a constitutional amendment to limit the draw on the Permanent Fund to a set percentage.
    “Sitka’s been doing percent of market value for 25 years, and it works fine,” Stedman said, speaking of the city’s own permanent fund. “This would be similar.” Earnings of the city’s permanent fund go into the city’s operating budget.
    Stedman says some local projects funded by the budget should provide an economic boost to the community. One is a wetlands mitigation project for Nakwasina and Starrigavan Valley to rebuild salmon stocks, using mitigation funds from the Katlian Bay project.
    “It will make for better recreation and commercial fishing,” he said. He noted other mitigation programs will be planned for Katlian Bay. He noted, “The Katlian River used to be one of the biggest coho runs in Southeast. We want to bring that back.”
    Other state projects are “Sawmill Creek Road Phase IV,” a major overhaul of the street between the turnaround and Jeff Davis Street, and the expansion of usable land at the airport by filling in the lagoon between the airport road and the runway.
    “And we’ve got the pool,” he said. The $26.9 million Mt. Edgecumbe High School Aquatic Center should be open for use by this fall, with legislative approval of $400,000 for operations and $200,000 for capital improvements, such as bleachers and other items.
    Stedman said he’s starting to look at other Edgecumbe improvements, particularly upgrading the classroom spaces and dorm rooms in buildings that date from World War II.
    “Not increasing the size, but increasing the quality for the lifestyles of the kids,” he said. “If we can build engineering buildings at University of Alaska, we can upgrade the quality of living spaces for the kids.” He added that the education of kids K-12 is a constitutional mandate.
    Addressing other community issues in Sitka, he said he’s concerned that the Sitka School District has not been putting timber receipts into savings, as have other Southeast communities.
    “I hope the message for the Assembly to the schools is they better put some money away and not spend it all, and not come back next year with another tale of woe,” Stedman said. “We can’t keep up with the funding requirements.”
    Stedman said he hopes the community takes advantage of the economic opportunities presented by the U.S. Coast Guard’s plan to station another cutter here, and the need for housing for 12 new families. The community should also be prepared to deal with a big increase in cruise ship traffic next year, he added.
    Stedman was appointed to a vacant seat in 2003, and is in the middle of his fourth full term. He serves Sitka, Ketchikan and many smaller Southeast communities.