In the last hour of the regular Ketchikan City Council meeting Thursday evening, council members discussed the status of the 2021 cruise ship season, a proposed electric and water rate hike, and the defunct Ocean Ranger program.
The council unanimously approved a $291,768 expenditure during the meeting to fund sales, marketing and convention-related services provided by the Ketchikan Visitors Bureau.
That amount of funding represents an annual decrease of 12.5%, according to a memo written by City Manager Karl Amylon and attached to the meeting agenda.
KVB President and CEO Patti Mackey explained to council members that to adapt to the decrease in funding, she scaled down items in the organization's Scope of Work, and created a more detailed marketing plan that is scalable to be able to adapt to changes in revenue.
In a Dec. 7 council budget meeting, Mackey described the challenges the KVB had faced in the 2020 tourist season that saw no cruise ships.
Mackey explained that one challenging area, for example, was the loss of about $150,000 per year in booth rent , which is money that normally funds marketing programs. In a letter attached to that meeting’s agenda, Mackey also described revenue losses from reduced advertising sales, membership dues and seasonal marketing income.
Cruise ship companies have been announcing that their sailings will be pushed back further into 2021 due to the ongoing COVID-19 pandemic. With that picture in mind, Council Member Mark Flora asked Mackey whether the KVB would be focusing more on small-scale tourism and independent travelers.
Mackey answered that the organization’s messaging is generic and broad, suited for all types of travelers, and that staff will be concentrating on independent travelers and conventions marketing. She added that companies running smaller ships also would be part of a marketing campaign.
Council Member Abby Bradberry said local businesses already have been seeing an uptick in independent travelers compared to 2019.
“Fantastic numbers in that area,” Bradberry said.
Council Member Riley Gass began a discussion about the Ocean Ranger program, saying it had been brought to his attention by a couple of people in the community who’d been involved with the program. He and Council Member Sam Bergeron had placed the topic on the agenda.
Funding for the now-defunct Ocean Rangers program, which was paid for by a $4-per-head state Cruise Passenger Vessel tax, was vetoed by Gov. Mike Dunleavy in 2019.
The Ocean Rangers program, part of the Alaska Department of Environmental Conservation, was created by a ballot measure in 2006.
Ocean rangers were U.S. Coast Guard licensed marine engineers who rode aboard cruise vessels to “act as independent observers monitoring state environmental and marine discharge requirements,” according to information at dec.alaska.gov. Ocean rangers also were responsible for checking that passengers and crew were protected from improper sanitation, health and safety practices.
Gass said he was thinking that an approach to get the program reinstated might be to ask the city's lobbyist, Ray Matiashowski, to present a case to the Legislature.
“I think it’s very prudent for all of Southeast, for everybody,” Gass said. “I think it’s a good check to have on there and the price is fair.”
He said he also would like the program, if reinstated, to focus on hiring Alaskans.
Bergeron asked what the money had been used on since the program had been dropped.
Amylon answered, “as I recall, I think the concept was to direct it to wastewater programs within the state.”
Ketchikan Assistant City Manager Lacey Simpson added that last year House Bill 74 had been introduced to address those issues.
“Upon the termination of the Ocean Rangers program,” she said, “those funds would be increased and directed to onshore, primarily municipal wastewater systems so, addressing the problem from a different side. So, rather than monitoring ships it would be creating infrastructure on the land to receive wastewater coming off of vessels.”
She explained that the bill never got off the ground in the last legislative session, however. When asked by Bergeron where the money for the program had been used after it was dropped, Simpson pointed out that no cruise ships came last season, leaving zero funds about which to make decisions.
When the discussion wound down, the council agreed by a four-hands vote to send a letter of support for the reinstatement of the Ocean Rangers program to Sen. Bert Stedman, R-Sitka, and Rep. Dan Ortiz, I-Ketchikan.
Also at Thursday’s meeting, the council in another four-hands vote approved a one-year deferral of the planned $1.1 million Stedman Street restroom facility near Thomas Basin.
During budget deliberations, council members had expressed mixed support for the project, which is currently in the design phase.
Gass said in the Dec. 7 meeting, “I never thought it was a reasonable project, in my own personal opinion, and given the current situation, where we’re at right now, that strengthens my opinion on it even more. I think this is just a little bit outrageous, to be honest.”
Bradberry said she was in support of the idea, but not of the location.
Council Member Mark Flora called the price for the restrooms “nuts,” but Council Member Dave Kiffer countered it was an expensive project, but “that’s the cost” to build such facilities.
Amylon recommended the one-year deferral, and reminded council members just before the vote that “if we begin looking at new sites, this will require a new design. It’s not something we can adapt from the existing design.”
Also during the meeting, Flora addressed the proposed water and electric rate hikes that the council will be voting on in an upcoming meeting. He spoke of the many questions, often based on misinformation, that he’d read and heard in the community since the rate hikes were included in the budget deliberations.
The increases proposed are a 5% water rate increase due to the “continued operating losses of the division” and the need to add two apprentice positions in anticipation of impending retirements in that department; and a 3% increase in electric rates in view of the Southeast Alaska Power Agency’s planned rate raise for purchased power effective June 1.
Flora asked that the council direct staff to provide a concise summary of historical rates, not only so that council members could clearly see the rate changes over the years but so that community members could as well.
“Let’s just see what rates, what’s going up,” he said, “let’s get an overview on the state of our infrastructure and what we need to do to keep the lights on, the water running and the wastewater going in the right direction, so that we can all come to the best decision — and I respect those that don’t support the rate increase and hopefully with this additional information, perhaps there’s some alternative ideas that those folks might have.”
He argued that no citizen is going to grind through 10 years of budget documents to dig up the information so it should be organized and compiled by city staff into something more manageable.
“I would just like the people we serve to understand our rationale regardless of how we vote,” he said.
Bradberry supported Flora’s request for a fresh, condensed report. She said that the community was in a “critical time” in which taxing citizens was a serious consideration.
“This is a huge issue and it needs to be addressed with the most information possible before we make the decision,” she said.
City of Ketchikan Mayor Bob Sivertsen took a more business-oriented tack. He said that the history of the rates already was in the budget document that can be accessed online by any community or council member.
“The reality of it is, we’re a service-oriented operation and everything around us is going up,” he said. “I don’t care what it is — whether it be groceries, heating oil or whatever it may be. Shipping has gone up tremendously in Ketchikan. And so, in order to continue to do business, the city is all about providing services, so if you need to provide electricity, there’s a cost associated with that and we’ve been doing it at a loss.”
He said that the conversation about potential utility rate raises comes up every year, and, each time,City Council members are reluctant to raise those rates. He added that to support utilities and maintain infrastructure, there’s a cost, requiring either a tax raise or rate raise. He explained that from his view, the raises are necessary but the way to make them as painless as possible was to implement them more frequently so each tax or rate hike is very small and incremental.
Amylon said, at the end of the discussion, that he and his staff would compile the historical rate information and provide it to the council before the vote comes before them.
During the Council Member comments portion, Council Member Janalee Gage brought up the issue of pedestrian safety on local streets, mentioning the recent death of a community member who was struck by a vehicle while walking in a crosswalk.
She and Council Member Kiffer both criticized what was described as the historically slow and insufficient response of the Alaska Department of Transportation to previous local pedestrian safety issues.
Gage said, “I want to see DOT do what they’re supposed to be doing for our community. That’s their job, and I’m tired of them going rogue, I’m tired of them deciding for us what we can and cannot do, and what our community deserves or what they think is justified.”
Council Member Flora suggested that possibly the city could look into ways to correct the most egregious safety issues on its own.