The idea for a utility subsidization program has roots in previous Assemblies, who oversaw multiple rate increases and wanted to soften the blow for the most vulnerable of Sitkans. (Emily Kwong/KCAW photo)

The City of Sitka is one step closer towards creating a utility subsidization program to support low income Sitkans. During Tuesday night’s meeting (03-13-18) of the Sitka Assembly, the group approved a revised ordinance establishing that program on first reading.

The Sitka Assembly also approved, on first reading, eliminating a garbage collection route that picked up trash along unserviced roads and a tariff schedule for the multi-purpose dock at the Gary Paxton Industrial Park. The Assembly upheld its decision from last meeting to endorse a national carbon fee and dividend. In new business, they voted through – on first reading – a purchase agreement to ship bulk water to drought-stricken Cape Town. We’ll have an interview with the prospective South Africa buyer and more on Raven News tonight at 5:18 p.m.  

Downloadable audio.

Sitka’s utility subsidization program would start in January of 2019, after an application period this fall. Those who qualify would receive a monthly rebate of up to $65.

The idea for such a program has roots in previous Assemblies, who oversaw multiple rate increases and wanted to soften the blow for the most vulnerable of Sitkans.

Assembly members Bob Potrzuski and Kevin Knox, who co-sponsored this latest ordinance, were a part of the Assembly that approved $400,000 for a subsidy program last year. “I stand behind what we promised before,” said Potrzuski. “I tried, with the work of staff and Kevin Knox, to meet the questions Assembly members had.” He estimates 250 households would benefit from the program.

To determine who would qualify for assistance, the City of Sitka plans to lean on existing programs. The applicant must be receiving assistance from either the Supplemental Nutrition Program or SNAP, the state’s Medicaid program, Baranof Island Housing Authority, and/or the National School Lunch Program. 

A revised version of the ordinance (Motion Memo and Ord 2018-04S), reviewed by the Assembly last night, eliminates the need for a 1099. Live aboard vessels are now considered qualifying households. Only one electric account can receive the subsidy. 

Chief Financial and Administrative Officer Jay Sweeney said his staff can handle all the paperwork on behalf of these specialty customers. “This would now allow them to be able to utilize the amount, which is now being paid on their behalf by the municipality, for other purposes. And that would make a difference to them,” Sweeney affirmed.

The $400,000 start-up money was a one-time source of funding approved by last year’s Assembly.

Mayor Matthew Hunter worried about the program’s sustainability. Should it continue, he would like the city to find an ongoing source of revenue. He offered the idea of eliminating the senior sales tax exemption.

“What you do is you take the Senior Sales Tax exemption and instead of just giving it blanket-wise to everyone of a certain age, you give it to people who qualify for need and you help the neediest of our population. That would be a way we could still help everyone, be they seniors or young families trying to make a go of it in this town trying to pay their utility bill. I think it would be equitable and revenue-neutral to our city,” Hunter said.

Assembly Aaron Bean thought the program was too costly for the city and that to save money, they should consider reaching out to the state for regulation. “A dollar saved is a dollar earned. I encourage us to be regulated by the Alaska Regulatory Commission. This is the business they’re in,” Bean said.

Assembly member Ben Miyasato also thought $400,000 was too much to spend on such a program. If it’s successful, he wanted to see it carry forward on a smaller scale.

Assembly member Richard Wein took issue with the eligibility requirements. He said the ordinance, as written, would miss certain pockets of the population. “The criteria should be based on total household income. If you look at the criteria of what constitutes a household, you can have five folks: one person has the meter who happens to be on Medicaid and their roommates. We really have to hone in on those types of things,” he cautioned.

Knox countered that while this may not be the perfect program, that the Assembly should take action to help those struggling to get by now. “Right now, we have plenty of people in this community that really need this and we have plenty of people that can afford to give back to those that need,” he said.

Knox added that he’d be happy to work with any Assembly members on refining the utility program into the future. The Assembly gave it an initial yes, by a vote of 5-2. Richard Wein and Aaron Bean voted no. The program will come up for second and final review at their meeting on March 27th.