Wrangell is one step closer to a budget as the Borough Assembly passed their 2012 draft budget with little fanfare last week during their regular session meeting at City Hall.
Comment came, however, during the public hearing held before the regular meeting – and saw one local businessman asking for a reduction in the current 7 percent sales tax levied on goods and services sold in Wrangell.
Ernie Christian, manager of Otteson’s True Value, asked the board whether a reduction to 5 percent might be feasible for the community.
“Thinking back to when we raised the sales tax, it was when we built the new school, pool and gym back in the mid-80s to offset the cost,” Christian said. “Those bonds have been long retired. If we reduced the sales tax from 7 percent to 5 percent, it would help everybody in the community.”
Finance director Jeff Jabusch refuted that by stating that a 2-cent reduction could pull nearly $500,000 out of the budget of Wrangell.
“Two cents is 28 percent down,” Jabusch said. “That would be half a million dollars. The estimate for total sales tax is $2.3 million. If we went from 7 percent to 5 percent, that would be half a million dollars less.”
During his comment period, Christian also challenged any future plans the borough might have to purchase the former mill site on Zimovia Highway.
“Honestly, I am against the city purchasing that because it is 57 acres of industrial site,” Christian added. “That would take it off the tax rolls and it would put that burden on other properties to make that up. I propose we keep it in private industry, whoever that might be.”
Before the assembly could deal with new business on their regular agenda, a number of citizens expressed concern over issues relating to the Wrangell Medical Center renovation project and the WMC Board of Directors recall election set for June 19.
Laura Salard, wife of Dr. Greg Salard, asked the board what the process would be to replace WMC board member if a majority of those facing recall are removed.
“If the recall goes through, who actually seats the new board members,” Salard asked.
After a brief period of conferring with borough clerk Christie Jamieson, the assembly deferred to borough manager Tim Rooney.
“Rather than us labor over this, this is something we should have our attorney look at,” Rooney said. “I’ll have him look at it and give us a written answer by the next regular meeting.”
According to Jamieson, if any WMC board members are recalled, the borough will set a special election within 60 days of certification of the results. Those chosen to replace the recalled members would then face another election for their seats in November.
WMC CEO Noel Rea also addressed the board over a letter his office received from project architects David E. Johnson and Associates regarding a contingency to upgrade the current hospital facility if a new hospital is not built.
According to the letter from DEJA, the hospital is in non-compliance with the Americans with Disabilities Act by having no rooms that are in line with ADA requirements.
Rea said the possibility of having the USDA-backed loan go to a vote as a general obligation bond, combined with the hospital’s non-compliance, could spell disaster for the hospital.
“I don’t know how the vote will go,” Rea said. “But, if they recall the board and the G.O. bond doesn’t happen, which I would expect, it is likely we would be cited on our next state fire marshal inspection and that would require us to make our rooms compliant.”
Construction related to compliance, Rea added, would mean the elimination of 10 beds – a move he said would be financially crippling to the facility.
“My impression is that we wouldn’t be financially sustainable anymore,” Rea said.
In new business, the assembly undertook a first reading of a proposed ordinance that would amend Title 15 of the Wrangell Municipal Code relating to electrical utilities.
The ordinance would change how the city deals with delinquent utility users – and how and when the lights could be turned out for having a delinquent bill.
“The proposed ordinance allows staff to send out regular monthly billing which will also act as the disconnect notice,” Jabusch said in a memo to the assembly. “Currently there are no guidelines and this section will help.”
If passed, any customer with a delinquent account would not be allowed to move accounts or open new ones until the amount owed is paid in full. Electric utilities would not be cut off to any account where life-support equipment is used and the customer is dependent on it.
The assembly also passed a resolution that will set the tax rate for property in the Wrangell Service area at 12.75 mills for 2012, and 4 mills for property outside the service area or in the differential tax zone.
“Just to be clear, this is not a new tax,” said assembly member David Jack. “It’s just a clerical issue we have to deal with each year.”
In the Borough Manager’s report, Rooney informed the assembly that Gov. Sean Parnell had approved more than $12.5 million in capital improvements for the borough.
Out of that amount, $6.1 million has been earmarked for boat yard improvements, $2.75 million for travel lift improvements, $1.8 million for the Wrangell Medical Center replacement and nursing home projects, and $1 million for construction and utility improvements on Wood Street.
Projects receiving funding under $1 million include $585,277 for the Cassiar Street water and sewer rehabilitation, $250,000 for the Chief Shakes House restoration and construction of a new carving shed, $62,000 for maintenance of the Wrangell Armory, and $50,000 for improvements to the gun range.
According to Rooney, the downtown revitalization of Front Street have seen the City Market retaining wall approximately halfway complete, and a completion of concrete work in the cul-de-sac, the intersection of Stikine Avenue and Federal Way, and the McKinnon Street intersection.
The assembly also moved to approve an increase of the WMC project budget to $31,119,825 – an increase of $1.8 million. The increase was a result of Gov. Parnell signing the 2012 Capital Budget. According to Rooney, the previously budgeted amount of $29,369,825 was based upon approved funding available in February.
The International Brotherhood of Electrical Workers Local 1547 will also be voting this week or next, Rooney said in his report, to form a two-year agreement between the borough and the union. If passed by the voting members of the IBEW, the borough would consider the collective bargaining agreement during the June 12 assembly meeting.
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