Steve Bradshaw, Shirley Robards, and Jim Dinley. (Photo by Robert Woolsey)
Speakers representing the municipal government, the school district, and local business spent far more energy shoring up their positions than discussing creative solutions to the growing gap between Sitka’s revenues and expenses.
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Moderator Keith Perkins emphasized the budget gap often during the ninety-minute forum. He characterized Sitka’s problems as structural: neutral or declining revenue for Sitka’s government, versus increasing costs for everything from fixing potholes to supporting school activities.
Panelist Steve Bradshaw, the superintendent of Sitka’s schools, described how health insurance costs had doubled from $1- to $2-million in ten years, and the less obvious costs of maintaining major school improvements, like the new Performing Arts Center.
Municipal administrator Jim Dinley outlined his challenges: Increased staff costs, plus replacing municipal infrastructure like roads, which were built during the heyday of state revenue sharing in the 1980s.
For Stereo North owner Shirley Robards, the issue has always been the increased pressure on businesses posed by declining cruise visits, combined with proposed tax increases.
Robards said the recent announcement by Fairweather Prints that it was moving to Juneau was a warning:
“I know that I can move somewhere, but I am vested in this town. We own two homes, and two pieces of business property on Lincoln St. And don’t think we don’t pay for it. When you own a business, you pay for it. Our oil is $4-5,000 a month. I know it’s a big building, and I know our prices are reasonable, and we compete every day with the internet – we have to, otherwise we won’t sell anything.”
Robards has been openly critical of recent assembly discussions over possible changes to the municipal tax code: Replacing the senior citizen exemption with a tax rebate is one idea that particularly bothers her, raising the $1,000-limit on taxable sales is another.
Moderator Perkins read a question from the large audience that might have mirrored the sentiment of many of the business owners in the room; it was an amusing broadside, but it put administrator Jim Dinley on the defensive.
Perkins – (Reads) ‘The issue is not more taxes. The issue is making more people feel welcome in Sitka and improving the business environment. Why doesn’t Sitka encourage more infrastructure to attract more tourists? Sitka has a terrible attitude against change and development.’ While they try to figure that out… (audience laughs)
Dinley – I think your question is: Do you still beat your wife? You’re going on the assumption that we’re not business friendly, that we’re not doing those things. We’ll have $4.5-million in centennial hall, which is going to be a big improvement. We’re looking at the increase in the museum. We’ve got money to rearrange the parking lot, make it safer for tourists. I’m not sure that there’s an attitude that we’re not business friendly. I think people start off with that – that it’s the city’s fault. But I don’t sense that.
The discussion polarized around the views represented by Dinley and Robards: Dinley stressing that he and the assembly were willing to listen to any ideas for cuts to the budget, or revisions to a tax structure which he considered antiquated; Robards expressing her antagonism toward any new taxes.
Ironically, it was superintendent Steve Bradshaw who chimed in first, when an audience member posed a new idea.
Perkins – The suggestion is that we replace the senior sales tax exemption with an exemption on taxing groceries for everyone. It would help all people of low income. What are your opinions?
Bradshaw – I went through this in my former community, and I thought it was a very reasonable solution. Don’t tax the necessities of life. Families need milk, they need eggs, they need to eat. They need certain medicines. But tax the luxury items. I’m sorry, I know that’s not going to set well with certain businesses in town, but if you’re going to change the tax – and I’m not saying you should – then don’t tax the necessities that people need for their survival. And that, I believe, in itself would help.
Dinley responded, “I share your concern” to the suggestion about lifting the tax on essentials, and then returned to his theme of standing ready to make cuts once citizens agreed on what services they wanted to lose. “God forbid that we should close the library for a day,” he said. Robards, who owns an electronics store, did not answer.
Of the three panelists, Bradshaw appeared the most conciliatory, possibly because of his distance from the actual problem: The school district is Sitka’s largest single expense, but the district itself imposes no taxes.
According to Jim Dinley, as things stand now, Sitka is looking at around a $700,000 deficit as it builds a budget for 2013.
Bradshaw urged the audience to think constructively.
“What I don’t want to see in this community, which has been so good to me and my family for fourteen years, we have the knowledge and resources to do what’s best for this community. So I don’t want to buy into this fear mentality that’s sweeping the country, when we have a community that has always done the right thing. I know this sounds like I live in my Walt Disney world – and sometimes I do – but I have belief in the people of this community who can find the right answers, and don’t need to point fingers at each other.”
But Bradshaw did not concede too much. He balanced the district’s budget this year with a half-million-dollar draw on reserves. He described kids as our country’s most important infrastructure. “Will I play fair when I go to the assembly and ask for money? Probably not.”
