City staff say current code doesn’t clearly reflect the full range of business ownership structures. The new ordinance expands the listed business types and makes business owners individually responsible for debts – or delinquent taxes. 

Municipal Administrator John Leach said when someone starts a local business, they have to get a business license from the State of Alaska. Then, they register their business in Sitka by getting a sales tax account. 

“When you get that sales tax account, the reason we need the personal guarantee is because we are essentially approving you to act as an agent on behalf of the city,” Leach said. “So we need that guarantee that you, acting on our behalf, are going to collect that sales tax, and you will then remit it back to the city, acting as our agent.”

Finance Director Brooke Volschenk said sales tax is unique since businesses collect it from customers and hold onto the funds until they give it to the city at a later date. A personal guarantee would provide an extra mechanism to hold business owners accountable for those funds if their business ceases operations or doesn’t have sufficient assets. 

Volschenk said this is essentially a “housekeeping” update that aligns city code with current practice and provides greater clarity and consistency for both staff and business owners. 

Mayor Steven Eisenbeisz said as a local business owner, he doesn’t like personal guarantees, but still voted in favor of the ordinance. He said it will only come into play if someone is a “bad actor” and doesn’t remit their sales tax to the city like they are legally obligated to do. 

“I could collect $30,000 in sales tax from our citizens, and then disappear, and there’s no recourse for the municipality,” he said. “What this does is make sure that if I disappear with that money, that the municipality can then use tools to come after me personally, not just my business, right? Because that is money that is collected and is supposed to be remitted to the municipality. It’s not my business’ money. Never has been, never will be.”

The issue will come back to the assembly table for a second and final reading at its next meeting.

In a memo, Finance Director Brooke Volschenk said current code doesn’t clearly reflect the full range of business ownership structures. The new ordinance would expand the listed business types and make business owners individually responsible for debts if their company defaults. 

Volschenk said it would align city code with current practice and provide greater clarity and consistency for both staff and business owners. 

In other business, the assembly will consider appropriating more than $1.1 million in federal funds to the Sitka School District on second and final reading. 

The Sitka Assembly meets at 6 p.m. tonight. Raven News will broadcast the meeting live, following Alaska News Nightly. 

The City of Sitka is continuing to brainstorm solutions to the island’s childcare shortage. In a special work session Tuesday night (6-16-26), the assembly decided to move forward with an option from a recently completed childcare study. It’s estimated to cost about $1 million a year. 

But assembly members still need to refine what they want in the plan before figuring out how to pay for it. 

Sitka has been grappling with the issue of childcare for years now: There aren’t enough options, it’s expensive for families already struggling with increasing daily costs, and there simply aren’t enough people working in childcare to expand capacity. 

The city decided to do something about it, and in January, hired a regional education nonprofit to write a report about the barriers to childcare and suggest possible solutions. Blue Shibler with the Southeast Childhood Collective released the 30-page report in March, and now the city is figuring out what to do next. 

“I think [Shibler] did a pretty good job of finding answers, or at least giving us some clarity as to what’s available and what isn’t, and some ideas about how we might move forward,” Assembly Member Tim Pike said at the June 16 meeting.

He said the city started its childcare discussion with three main goals in mind: To increase capacity, stop the rise in childcare costs for parents, and maintain the viability of existing childcare facilities in town.  

“My goal tonight is to see if we, as a group, can come up with what Sitka’s plan for childcare looks like going forward, so that we can see whether that matches what the community wants and/or needs, and also [have] a conversation as to how we figure out how to pay for that,” he added.

Eight community members spoke at the meeting, saying there’s a dire need for childcare solutions in Sitka. 

Dr. Kimberly Capp is a local pediatrician. She said childcare centers and programs like Head Start are important for children’s safety and for catching developmental disabilities. She said while the city, the SouthEast Alaska Regional Health Consortium, and Sitka Tribe of Alaska all continue to have meetings about childcare, no one wants to “own” the issue, and it’s time for that to change. 

“People are willing to pay for childcare, they just can’t pay more than they make,” Capp said. “So count the fees, count the possibility of grant partnerships or things like that, use the resources you have for excellent childcare in the limited spaces that exist, and help them help you expand.”

Patricia Bauder manages Avis Alaska Car Rental at the airport. She said they’ve lost several employees due to the lack of childcare options in Sitka, and it’s negatively impacted their business. She said the city needs to be involved in a solution, and suggested it provide subsidies to both families and childcare providers. She also pointed to a proposal in New York City that would tax high-value second homes to fund city programs, including expanding affordable childcare. 

“It’s difficult to attract people in the business of childcare because they’re not paid enough, and if you pay them what they’re worth, then parents can’t afford the cost of childcare,” she said.

Erin Clay moved to Sitka with her husband in 2014. She said finding childcare has been a continual stresser on her family since their four-year-old son was born, and that it’s affected her ability to work outside of the home. She said the system’s flawed, and suggested funding a career pathway for youth. 

“One of the biggest challenges that we’ve found is the turnover,” she said. “He’s had great caregivers, but they can make more money cleaning Airbnbs, which feels really broken.”

Assembly Member Katie Riley thanked the community for showing up. She said she thinks a “phased approach” is the best way to tackle the issue, and suggested filling Sitka’s existing facilities and stabilizing the system before trying to expand it. 

“There are not many problems that you can just throw money at and they get better, but this really seems like one of them, and that’s a unique opportunity,” Riley said.

Pike said the city could continue to study and study and study this problem, but it’s time for action. He said there are a lot of things the city asks the community to invest in because Sitkans want their lights to turn on and their roads to be paved. He said this is no different than that, and the city is going to ask the community whether or not they want to invest in their kids. 

“Is it going to cost people? Yeah. Is that a question that should be asked on a ballot? Absolutely,” he said. “We want the people of the community to tell us whether or not they want to invest in kids. I think everybody up here says this is good. Everybody in the room here says this is a really important thing, but the community is going to have to step up. It’s going to have to spend money, and they’re going to have to say, ‘This is important.’”

Ultimately, assembly members agreed to move forward with the report’s Program Option 3, a blended model which combines three strategies, including workforce incentives, per-child operating grants, and a family affordability component, which is estimated to cost about $1 million. They also unanimously expressed support for adding a workforce development component for youth into the plan.

The assembly plans to hold another work session on the issue in the coming months to hash out how to pay for it before putting the issue before voters. 

The Sitka Assembly voted to allocate more than $1.1 million in retroactive federal funding to the Sitka School District at its meeting Tuesday night (6-9-26). The money comes from Secure Rural Schools, a program that supports schools surrounded by federal lands which don’t contribute to the local tax base. 

For the past two fiscal years, SRS funding lapsed. Then, last December, Congress renewed the funding for this year, along with retroactive payments for the missed ones. The money can be used for schools or roads, and in years past, the city usually split the money with the district 50/50. But this year, the assembly is going all-in on education. On Tuesday, the assembly voted to dedicate 100% of the federal funding received to schools, adding more than $800,000 to what it has already budgeted for the district. 

In the last budget cycle, some of the federal funding had been earmarked for the Public Works department for street maintenance, but the money didn’t come through until recently. 

“There are needs at the school district, there are needs at the city,” Mayor Steven Eisenbeisz said Tuesday. “I could argue the school district’s needs are larger. I could argue our potholes’ needs are larger.”

Municipal Administrator John Leach said the assembly expressed a desire to move the full amount to schools given their precarious funding situation next year. Even with last year’s state funding increase, school leaders say the money hasn’t kept up with the rising cost of education, and declining enrollment over the past two decades has also cut into the district’s bottom line.

The district was already facing a $1-2 million deficit in March, when staff discovered an accounting error to the tune of about $800,000 in unaccounted for expenses. In late April, the board approved a budget that cuts 8.5 positions, half of which are certified teachers. 

Eisenbeisz said this is a one-time disbursement for the district and he doesn’t want schools to rely on the full amount of pass-through funding in future years. He advised the school board to use the money wisely. 

“I understand the crutch is needed to bridge a gap, which may or may not be changing in future administrations at the state, but I don’t want them to become so assured of this and this funding level that that becomes an issue that binds future assemblies and future school boards to an unsustainable level,” he said.

Assembly Member Tim Pike agreed that the move is a rare, one-time occurrence, but said it was important for the assembly to take advantage of this opening to help the district. 

“This is a unique opportunity for the city to support the schools,” he said. “The needs are very large, and the state has not stepped up and done their part. So this is an opportunity to bridge us through into a hopefully better fiscal environment with a governor who would be more amenable to funding education and meeting the requirements for the state.”

Several assembly members said they support a continued push for Secure Rural Schools funding when meeting with Sitka’s congressional delegation in the future, saying the funds are important for both the district and the city.

Ultimately, the assembly voted unanimously in favor of the one-time allocation. It will consider the funding one last time before a final vote on June 23. 

The funding comes from Secure Rural Schools, a federal program that supports schools surrounded by federal lands which don’t contribute to the local tax base. 

For the past two fiscal years, Secure Rural Schools funding lapsed. Last December, Congress renewed the funding for this year, along with retroactive payments for the missed years. The money can be used for schools or roads, and in years past, the city has split the money with the district 50/50. Tonight, the assembly will instead consider dedicating 100 percent of the federal funding received for Fiscal Year 26 to schools, adding more than $800,000 to what it has already budgeted for the district. 

In other business, the assembly will consider approving a new labor agreement between the city and the union representing Sitka’s police. Labor negotiations began with the Public Safety Employees Association (PSEA) in late April, and the parties reached a tentative agreement in mid-May. Changes include an updated pay scale and leave provisions. Overall, the estimated increased cost to the city is about $312,000 over the proposed 3-year contract, which starts July 1. 

The Sitka Assembly meets at 6 p.m. tonight. Raven News will broadcast the meeting live, following Alaska News Nightly. 

Sitkans will consider amending the city’s Home Rule Charter in the upcoming municipal election. At its meeting Tuesday night (5-26-26), the Sitka Assembly voted to put a question to voters this fall that would give the assembly more discretion over when to schedule a special election.

In Sitka, citizen initiatives can go out to voters in a special election, provided that the sponsors can secure enough signatures. Once they’ve gotten the signatures, the city’s charter requires a special election within the next 40 to 90 days. The new ordinance would eliminate that requirement, and instead give the assembly the authority to decide whether to hold a special election, if it thinks it would be in the best interest of the city. If not, the petition would go before voters at the next scheduled regular or special election.

Municipal Clerk Sara Peterson said if approved by voters this fall, the amendment would bring Sitka more into alignment with other communities across the state. She said the amount of money and staff time it takes to put on a special election is what prompted the proposed change. The 2025 special election that would have capped cruise ship traffic cost the city more than $18,000.

Larry Edwards with Small Town Soul, a local advocacy group that authored the visitor cap proposition, said the group supports the charter’s requirement, and urged the assembly to vote no on the amendment. 

“In practice, democracy sometimes comes with a cost, and sometimes comes with inconveniences, and sometimes both, but those are not reasons to restrict it,” Edwards said. “It is important for citizens to be able to trigger an initiative special election on a major issue that is time sensitive.”

Assembly Member Katie Riley was concerned it could leave petitioners waiting a long time between filing and voting. She said while she isn’t against putting an amendment forward to Sitka voters, this isn’t the amendment she would go with. 

“There’s a lot of fear out there right now, and there’s a lot of fear about changes that are happening rapidly in our country, and that’s very real perceived fear for some folks,” she said. “I think that this is a pretty technical fix, but it’s occurring in a context in which people have a heightened sense of things that are happening around them and how that might impact their personal lives and their ability to make their voice heard.”

Assembly Member Tim Pike said he doesn’t think the change would hurt the democratic process. He said the state statute language is “battle tested,” and he thinks they should put the question to the voters. 

“I think it’s an opportunity for us to hear from the people and see what they’re feeling. We are not the deciders on this, we are just presenting a question to the public, and as such, I think the risk to democracy is quite low, because democracy will speak and decide whether or not this is a good idea or a bad idea,” Pike said.

Ultimately, the amendment passed 4-2, with assembly members Riley and Scott Saline opposed. The proposition will be included on the Oct. 6 election ballot. 

The Sitka Assembly formally accepted the resignation of Assembly Member Tim Pike at its meeting Tuesday night (5-26-26). Pike is a recently retired Career and Technical Education teacher at Sitka High School, who’s served on the assembly since late 2022. He said he’s stepping down due to family needs. 

Assembly Member Scott Saline said Pike would be missed.

“I get all teary-eyed thinking of your leadership that I know rubbed off on my kids, man,” Saline said. “Sorry to see you go.”

Assembly Member Katie Riley, who was elected last October, said she looks forward to hearing Pike’s thoughts on future issues despite him no longer being on the assembly. 

“I didn’t get to serve with you that long, which is my loss, but [I] just really appreciate the perspective and the very careful deliberation that you brought to the table. It always makes me think deeper about the issues that we’re talking about, and lends just a really unique, wonderful perspective,” she said.

Pike’s last day in office will be June 30. The assembly will advertise for letters of interest to fill the vacant seat, and at the July 14 meeting, the group will appoint someone to fill it until the municipal election on Oct. 6. 

Pike, a recently retired Career and Technical Education teacher at Sitka High School, has served on the assembly since late 2022. In a letter to Municipal Clerk Sara Peterson from May 20, Pike said due to family needs, the June 23 assembly meeting will be his last. 

The assembly is expected to either advertise for letters of interest to fill the vacant seat, or place an item on the June 23 agenda to appoint someone to fill it until the next regular election in October. 

In other business, the assembly is expected to approve the property tax rates for the next year and give final approval on the city’s operating budget and capital improvement plan. 

The Sitka Assembly meets at 6 p.m. tonight. Raven News will broadcast the meeting live, following Alaska News Nightly. 

The Sitka Assembly on Tuesday (5-12-26) passed the city’s final operating budget and capital improvement plan for Fiscal Year 2027, which starts on July 1.

Municipal Administrator John Leach said this year is closing in a financially stable position, but notably tighter than recent years. He said the gap between what the city brings in and what it costs to operate has continued to narrow and it’s shaped every decision reflected in the budget. He said while the budget doesn’t resolve every long-term pressure the city is facing, it’s a “clear-eyed response” to where things are right now.

“Sales tax remains our foundation, but we’re watching the tourism season closely, and federal funding uncertainty continues to create planning challenges for all of us,” Leach said. “Fuel costs for me are a particular concern this year, and those hit us on both sides of the ledger. So it raises our own operating costs, while it also potentially dampens visitor activity and sales tax revenue that comes with it.”

To balance its books, the city had to cut about $900,000 from the proposed budget. Those cuts include the purchase of two patrol cars for the police department and a police sergeant position, as well as $250,000 for athletic field sand.

The assembly also approved the enterprise fund budgets on Tuesday, which include another round of rate increases to keep up with maintenance and infrastructure costs. While electrical rates will remain the same to give Sitkans a bit of a break, there will be a 6% increase in water rates, 2% increase in wastewater, 2% in solid waste, and 4% in harbor rates. 

Leach said in a memo that the budgets prioritize maintaining the city’s core services, supporting strategic initiatives, and preserving long-term financial sustainability for Sitka.

The budgets were approved by the assembly on first reading. They will review them for a final reading on May 26.

Sitka’s childcare system has the capacity to serve only about half of the young children who need it, according to a childcare needs assessment that was presented to the Sitka Assembly at its meeting Tuesday night (5-12-26).

For years, parents and providers in Sitka have said childcare capacity on the island is at its limit. Now, the assembly is taking steps to address the issue. Earlier this year, the city hired the Southeast Childhood Collective to conduct a study, in an effort to understand and tackle the community’s childcare shortage. 

The 30-page report analyzes the island’s childcare system and outlines three programming options to “improve stability, strengthen the workforce, and expand access to care.”

Blue Shibler, executive director of the regional nonprofit, said Tuesday that city governments across the state are trying to step it up because lack of childcare access is hurting local economies, affecting every sector of the workforce. 

“We hear this from businesses in almost every industry. We hear it from chambers across the state and across the country, that the number one reason they have a hard time attracting employees and keeping employees is because they can’t find childcare,” Shibler said.

The report lays out three main childcare constraints: supply and demand imbalance, workforce limitations, and affordability. 

It estimates that around 485 young children in Sitka require regular childcare. The licensed system has the capacity to serve about half of that. The report also says local childcare workers face a persistent wage gap that limits recruitment to the field, and estimates monthly tuition in Sitka far exceeds the federal threshold for affordable childcare. Federal benchmarks define childcare as affordable when it does not exceed 7% of household income. Based on Sitka’s median household income of about $101,200, the affordable monthly cost of childcare is $590. In practice, monthly tuition in Sitka averages approximately $1,600 for infants and $1,450 for toddlers, according to the city.

Shibler said the private market can’t increase the childcare supply on its own. A sustained public investment is needed, and strengthening childcare is a long-term investment in Sitka’s future. 

“It’s important to note that the impacts of supply shortages extend across the community, in terms of reduced workforce participation, employer recruitment challenges and ultimately, population decline,” she said. “That has been talked about throughout the Southeast region quite a bit — that we’re losing families and the workforce age demographic in general because they can’t find childcare.” 

The report suggests several program options that could cost anywhere from $277,000 to $2 million. They range from workforce incentives to subsidies and scholarships.

Program Model 1 — the least expensive option — is a workforce incentive program to address low wages. Model 2 provides a subsidy, or per child operating grant. And Model 3 blends the first two, and adds a family affordability component, like need-based scholarships from the city. Shibler said the program proposals are largely based on what has been successful in Juneau.

But how the city would pay for the programs is still unclear. 

Three options were put forward to raise the necessary funds, including a 2% alcohol tax, a 1% seasonal sales tax for the winter months, or an additional 1% summer season tax. 

Assembly Member Katie Riley said she’s “extremely uncomfortable” with a winter sales tax increase. She said it would be a burden that the working families in the community simply can’t afford. 

“That doesn’t mean that they’re not thinking long term,” Riley said. “That doesn’t mean that we don’t know the importance of this. That means that right now, cost pressures are insane, and people do need to look out for their short-term costs in addition to thinking about that long-term picture.” 

Assembly members agreed they want robust community input and further discussion before moving forward.

“I’ve heard the word ‘cost’ a lot,” said Assembly Member Tim Pike. “I actually think the right word is ‘investment.’ Right? We’re investing in our children as a community, and I think it’s important for us to keep that in front of us as we look at this funding process. It’s not a cost, it’s an investment, and it’ll pay dividends for us down the road, and it helps our community go forward.”

The assembly plans to hold a public work session in the next month to further discuss the issue.