Voters this fall will also be asked a ballot question that, if passed, would raise the mill rate for the first time in 20 years. (Photo by Rachel Waldholz/KCAW)

In October, voters will be asked a ballot question that, if passed, would raise the mill rate for the first time in 20 years. (Photo by Rachel Waldholz/KCAW)

On Tuesday night (08-10-16), the Sitka Assembly (08-10-16) approved placing a question on the October 4th ballot to raise the property tax cap from 6 mills to 8 mills.

This means that for every $1,000 your home is worth, you would pay $8 in taxes instead of $6. With state and federal funding sources uncertain, the Assembly is looking for local sources of revenue to meet the city’s budgetary needs.

An early draft of the ordinance bundled a mill increase with tax breaks, such as repealing the sales tax on groceries, offering a homestead exemption for the first $50,000 of a property’s value, and funding the school district to a certain percentage of the cap. The final ballot question doesn’t include any of these measures.

See property tax ballot proposition here: Ord 2016-26

This bothered citizen Larry Crews, who wanted the ballot language to specify how the money would be spent. “The way it’s written right now I would highly oppose it and I would expect everyone else in this town would oppose it in this town, until you can be more specific about what you want to do with it,” Crews said.

Deputy Mayor Matt Hunter responded that writing the ballot question that way would be illegal. The power to repeal the sales tax on groceries, for example, rests with the Assembly, not the citizens. So, to insert a non-binding agreement into a ballot question would violate state law.

Furthermore, state law requires that ballot propositions pose a single question, to avoid confusing voters. “That’s why our questions have to be extremely explicit and simple and that’s why our initial ballot initiative was illegal and unfortunately we can’t ask more than one question in the ballot question,” Hunter said.

While the Assembly wasn’t swayed to revise the ballot question, Steven Eisenbeisz did agree with one aspect of Crews’ comment. Eisenbeisz said, “There have been lots of promises thrown around at the Assembly table. If you vote for this, we’ll do this. If you vote for it, we’ll do this. I believe that this ballot initiative is going to pass tonight and put the responsibility back in the hands of the citizens. But we as an Assembly need to figure out, before election time, what of those promises do we intend to fulfill. We need to lay that out in some sort of ordinance that would become effective if this passes and let the citizens know exactly what we are going to do.”

The Assembly is already drafting two ordinances, which – if the ballot question passes – would pass as well. One, sponsored by Eisenbeisz and Swanson, would subsidize the electric fund. The other, sponsored by Tristan Guevin and Bob Potrzuski, would repeal the sales tax on groceries. The Assembly will consider these ordinances at a future meeting.

In new business, the Assembly will approved a collective bargaining agreement with the International Brotherhood of Electrical Workers. Wages will increase by $1.25 an hour this year and by $1 in 2017 and 2018.

The Assembly also approved a final plat for the Nakwasina Sound Subdivision, which includes 122 acres of waterfront land on the Lisianski Peninsula. While a 50 foot easement along the waterfront will be open to the public, 18 parcels will now be available for private purchase.


The Assembly approved zoning for land once under state ownership, boxed in red. The 18 lots and 1 tract of the Nakwasina Sound Subdivision will now be available for residential development.

The Assembly also approved an Open Space (OS) designation for the subdivision. Senior Planner Michael Scarcelli said open space zoning would allow for residential development while preserving the rural character of the area. Hotels, for example, would not be allowed. “There’s not going to be city services out there, so the open space is the preferred method to preserve the type of habitat and use,” Scarcelli said.

The Assembly also – on second and final reading – increased moorage rates by 5% and water and wastewater rates by 1%.

Before adjourning, the Assembly met to discuss its loans of over $600,000 to the Baranof Island Brewing Company. BIBCO received its first loan from the Southeast Economic Development Fund in 2011, and has been struggling with repayment. After 45-minutes of closed-door discussion, the Assembly issued a statement saying that the brewery will only have to pay interest on its loans until April 1st, 2018. Principal and interest payments will be put on hold until that time.