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Wednesday’s presentation before the weekly lunch at the Greater Sitka Chamber of Commerce dealt with two major ballot issues.


The first is an advisory vote on $50 million dollars in bonds for improvements to the Blue Lake hydro project.


City finance director Dave Wolff says a yes vote demonstrates community support, which gives the lenders confidence and keeps the interest rate down.


“This is your chance to say, so we have the whole town saying, ‘Please, yes, we approve this project. We understand that by voting yes, possibly the interest rate on the debt will go down, which means the rates won’t have to go up as much,’” Wolff said.


The city already has about $28 million dollars in bonds on the books, and it’s paying around 6 percent interest. The $50 million dollars in new bonds would have an interest rate near 3.2 percent. 


The city will use the new bonds to pay off the old bonds. Wolff says it’s like refinancing your house at a lower interest rate. About $21.2 million dollars will be left over for the Blue Lake project.


Wolff says electric rates will go up a couple cents per kilowatt hour to pay down the debt. But the lower interest rates will keep that rate increase from being greater.


“If it doesn’t pass I’ve got a feeling we’ll see the interest rate at about 3.7 to 3.8,” he said, “which means there’s going to be more debt service, which means that 2 cents I’m telling you will go up maybe 3.”


The Blue Lake project includes raising the dam by 83 feet, adding a new turbine and powerhouse, and replacing the two existing turbines. City officials say more electricity from Sitka’s hydro plant will cut down on the need to burn costly diesel fuel.


The presentation from the city was followed by one from the school district, on the three questions it has on October’s ballot.


The first, labeled Proposition 3 on the ballot, is for $2.4 million dollars in maintenance for Blatchley Middle School, including air-handling units.


“It’s the mechanical for the building,” said Sitka schools Superintendent Steve Bradshaw. In my mind, we can’t go without Proposition 3. It’s not that we can go without Proposition 4, but Proposition 3 will get us the basic necessities we need in that building.”


The state will reimburse more than two-thirds of the $2.4 million dollars in proposition 3, and more than two-thirds of the $3.3 million dollars in bonds included in Proposition 4.


“Prop 4 basically covers the locker rooms, the bathrooms, the floor coverings, some of the ceiling coverings, trying to dress the building up,” Bradshaw said. “I don’t know how many of you have been in the building lately, but if you walk down the stairs especially, the tread on the stairs is going. The building is probably in the worst shape of any building, other than Pacific High School, that we have in the district.”


Which brings us to Pacific High School’s needs, included under Proposition 5.  Prop 5 will allow the school district to use money from Sitka’s extra 1 percent summer sales tax in order to fund renovations at Pacific High, the district’s alternative high school.


The school district expects to spend around $2.7 million dollars on that project, but again, the state will cover most of it. The city here is being asked to fund about a third – or just over $900,000.


School officials and Wolff, from the city, say using the sales tax money to do fund Pacific High’s renovations will not lengthen the original 20 year term of the tax, approved by voters back in 2003.


Bradshaw says he knows there are a lot of questions about Pacific High School, and why renovations are necessary. He says in its 15 years, Pacific has graduated 7 to 10 students per year who otherwise wouldn’t have a high school diploma.


“So the importance of Pacific High School to me, and remodeling Pacific High School, is about the 35 to 55 kids that we average in that building every year,” Bradshaw said. “It’s about providing a second chance for a student that’s given up on your typical, traditional education. And it may seem like a lot of money we spend at Pacific High School. Dollar for dollar, we probably spend more in that building than any other building. At the same time, if you look at the needs of the kids we deal with there, it’s a great expenditure of funds, folks.”


Bradshaw says none of the school district’s proposals will raise taxes.


All of the questions will appear on the October 5th municipal election ballot, along with ballot propositions on funding for Hames Athletic and Wellness Center and a question about Sitka’s ban on smoking in places of employment.

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