Local News

Assembly approves BIBCO loan

The Sitka Assembly on Tuesday night (2-11-2014) approved an economic development loan of $350,000 to the Baranof Island Brewing Company. The brewery will use the money to invest in a more efficient grain mill, which it said will allow it to meet a demand for its beer that right now is outstripping its brewing capacity.

The brewing company also plans to launch a new line of canned beer. As of now, the brewery distributes most of its beer in 22-oz bottles. Brewery owners Rick and Suzan Armstrong said that cans are cheaper to ship into and out of Sitka, more environmentally friendly, and have a longer shelf-life – and contrary to what you may have thought, Rick Armstrong said, they don’t change the taste.

“You can’t taste a flavor difference in the can. What you can taste is the aluminum lid of the can. So if you’re a true beer nerd you should pour it into a glass before you drink it,” Armstrong said, to laughter.

It is the brewing company’s third loan from the fund since the brewery was founded in 2009. The Southeast Alaska Economic Development Revolving Loan Fund, also called the Stevens Fund, was created to support projects that diversify the local economy, and provide employment outside the timber industry. The brewery currently has six full-time and five part-time employees. It estimates the expansion will allow it to hire two more full-time employees.

During the meeting, the assembly also heard from Sitka Representative Jonathan Kreiss-Tomkins, who called in from Juneau with this report:

“In short,” he said. “The state is going broke.”

Kreiss-Tomkins said that the state has seen a dramatic shift in the past few years from budget surplus to budget deficit – one that is particularly evident in the capital fund, which pays for major infrastructure projects.

“Three years ago, the legislature was writing almost $2-billion in capital projects into the budget,” Kreiss-Tomkins said. “Two years ago, that number went down to $1.1-billion, and then last year that number’s now at $400-million. And this year it’s probably going to be even less than that, I would guess in the $300-million range.”

That’s a reality that hit Sitka this year: the city had hoped the state would chip in about $18.5-million to finish the Blue Lake hydro project, but that’s looking increasingly unlikely. The city is now applying for a low-cost loan from the Alaska Energy Authority to cover that final $18.5-million – but even the loan requires approval in both houses of the Alaska legislature.

To that end, a delegation from Sitka, including Mayor Mim McConnell and City Administrator Mark Gorman, will be in Juneau tomorrow (2-13-2014) for a marathon round of meetings, to discuss the Blue Lake expansion with legislators, the governor’s office, and perhaps the governor himself.

The assembly also heard a report from Gorman, who had accompanied the McGraws, owners of the Old Sitka Dock, on visits to several cruise ship companies this month.

“Sitka is clearly seen as a different port to the cruise ship industry,” Gorman said. “The descriptors of ‘authentic’ and ‘real’ were used by seven cruise ship companies we visited, and I think, in there lies an opportunity for branding…They talked about the marquee ports – Juneau, Ketchikan, and Skagway  – and said, ‘Sitka is not one of those, and our guests, our passengers, always come back and say, we love Sitka for being a real community.’ So I think we need to capitalize on that.”

The Assembly also passed on final reading an ordinance encouraging city agencies to purchase goods and services locally.



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