Assembly Work Session of May 8, 2025

Okay, I will call to order the Kodiak Island Borough work session of Thursday, May 8th, uh, 2025 at 6:35. We have a quorum present. We are in the assembly chambers. First item we have is citizens' comments and, uh, This is for anybody that wishes to speak on anything here. There's only citizens' comments at the beginning of the meeting.

The local number is 907-486-3231. The toll-free number, 855-492-9202. If you wish to speak, please come up to the podium. And sign in and turn the mic on and state your name for the record, please.

Good evening. For the record, my name is Cindy Micah, and I'm the superintendent of the Kodiak Island Borough School District. Thank you for the opportunity to speak tonight in support of the borough's approval of the school district budget on May 29th. I want to express my appreciation to the assembly for coming together with the Board of Education in March to discuss the district's budget and the financial challenges facing both our district and the community.

The district began the budgeting process in October when our fiscal year '24 audit was completed. With a projected $10 million deficit for the upcoming fiscal year '26. As a result, the district began looking at ways to reduce costs, and in February, the Board of Education made the difficult decision to close North Star Elementary, a move projected to save approximately $3 million, primarily in personnel-related costs. On April 21st, the Board of Education passed the preliminary budget, which was formally submitted to the borough manager on April 30th. Our request for $12,979,556.50 represents an increase of $662,998.50 from the fiscal year '25 budget request.

Despite the increase in dollars, this amount maintains the borough's contribution at 96.11% of the cap, the same as in fiscal year '25. The district's preliminary budget is built on the assumption of a $340 increase to the base student allocation and the use of $5 million from our fund balance. The borough's approval of the full ask by the district is critical to maintaining essential programs and services for our students amidst the rising costs that we face. We appreciate your partnership and commitment to education, and I respectfully ask for for your support on May 29th in approving the district's full ask of $12,979,556.50.

Thank you for your consideration and for your continued support of Kodiak students and families.

Thank you. Anyone else wishing to come forward and speak under citizens' comments? Do we have any calls?

Hearing and seeing none, we'll move on to agenda items. We're going to start with B, introduction of Emergency Management Manager Rich Gonzalez. Amy, I'll turn it over to you. Thank you, Mr. Mayor. Mr. Gonzalez is here tonight so that he can introduce himself officially and answer any questions that you might have about his new position.

As you'll remember, the City of Kodiak and Kodiak Island Borough are jointly funding this position for the Kodiak region. He started at the beginning of 2025 and has spent time learning about how both municipalities are organized, presenting weekly situation reports, reaching out to village public safety operations officers, and presenting at several events including the rule forum at the end of March. This week's, um, oh, I didn't do this week's report, did I? He actually did a memo for you guys to read about some of the stuff that he's accomplished and So here's Rich, and you might know him from around town. He's been in Kodiak for a while, and I wanted to have an opportunity to introduce him and see if you guys had any questions about what he was up to.

Good evening, Mr. Mayor and assembly. Amy, thank you. Rich Gonzalez here to formally introduce myself. Why don't you go ahead and recap? Doesn't look like there's any questions right, right now.

Just kind of recap for the public out there listening. Okay, so, uh, the position started, uh, well, created in January, and I started on January 2nd, um, and been busy ever since, hitting the ground running, uh, trying to get some of the committees back up, uh, local emergency planning committee, just out sent out some information about that. I've been working with Mr. French on the hazard mitigation plan. Attended the emergency management conference a couple of weeks ago where I was able to network with a lot of the folks from the state and on the federal side, so made a lot of good connections. They were real happy and excited to see that this is a position now in Kodiak.

And I attended the LEPC meeting for the state, the state LEPC meeting, which was again very welcoming, and they were very excited to have somebody sitting in the chair with the nameplate Kodiak on it. So just been real busy trying to get everything up and running as far as emergency management.

Jaron, then Larry. Thank you. Hey, Rich. Hey. Thanks for jumping into the role.

I have just a couple of just Small, small questions.

I hear that you are making some inroads with like local media, KMXT particularly, and seeing where they fit at the table at the— on the LEPC.

And I think we went— I think one of the issues that we had during COVID was there was that bridge was just not there, and I think it led to a lot of public confusion about a lot of things. I think during tsunami emergencies, it seems to work well, but the people who are in those positions are no longer in those positions. So, right, we want to create a communication system that can work, you know, with anybody plugged in. Yeah, definitely. And I've been spending a lot of time with both KMXT and KVOK talking about, as well as the Kodiak Daily Mirror, talking emergency management management stuff.

Just recently submitted for our IPAWS notification process where we can send out our own emergency alert system type of alerts, and I've been working with KVOK in doing their community plan for that before sending it up to the state and all that. So I've been, I've been very engaged with them as far as communications. The lines of communication are very open, and I'm making sure that I I keep them in the loop about everything. Cool. My last question was, I was just in Akiak a couple days ago, and their tsunami siren still isn't working, is what they told me.

And I think it's come up in the past, but I think we kind of forget about it. But—. OK. I just thought I'd mention it. It's not really a question.

I just thought I'd mention it. Yeah, no, thank you for that. Yeah, I'll definitely look into that. But thank you for that. Larry.

Well, this is sort of the question that Jared asked. Have you had the opportunity to meet with each of our rural villages to talk about their emergency planning and how they can be in sync with our plan? So I've reached out to them via email, and then I also attended the rural forum. Didn't really— I was introduced there, but didn't really get a chance to sit down with anybody and talk face-to-face. But I have been reaching out to them.

Sending out emails and trying to get that information back so we can establish that relationship. What I would recommend perhaps that you maybe meet with the superintendent or the borough, and sometimes they fly in and they have empty seats because of freight or something like that, that it would give you an opportunity to, you know, actually go out and spend some time with the folk there. I'm sure they would appreciate it, and it would be sort of fun for you too to see what the other end of the island The other question I have is— and I assume this is going on— but in 1964, during the tidal wave, they declared martial law in Kodiak. And so downtown Kodiak, and among the debris, there were Navy sailors, if you will, carrying guns.

Is the Coast Guard actively involved? I'm not suggesting martial law or anything, but are they an active part of your planning? You scared me there for a minute. I thought there was something I wasn't aware of. Yeah, they are.

So I've also been working with them, with their environmental folks that are assigned to their emergency management and also their warrant officer that's doing their emergency management stuff. And I communicate quite a bit with the Coast Guard Fire Department out there as well. Thank you. Mm-hmm. Amy.

I was also going to add that we, I passed along the training information that we did last summer with the University of Texas A&M. They're gonna get mad that I put university in front of that Texas name, aren't they, Cindy? Texas A&M, their program is called, the acronym is TEEX. They're coming again this summer, and last summer all the VPSOs came in and were able to attend that training. So that was a, we were very thankful for Kana to get them in here, and that was a really good way to find out what our relationship was in emergencies with them.

So hopefully they'll come again this year. Any other questions? Well, thank you, Rich. Appreciate you coming forward. Okay, next item we have is discussion of the Kodiak Island Borough School District funding request.

Amy. Thank you, Mr. Mayor. And if you're following the agenda, you're going to see that we are passing on the building inspector report because our building inspector is tied up at the city meeting. So as soon as he gets here, we'll go back and pick that one up. Um, for the school funding request, uh, we wanted to add this to two work session agendas, so you'll see it tonight for the beginning discussion, and then we'll— it'll come up as a topic during the May 29th work session before the special meeting when we actually vote on it.

So as the superintendent said just a few moments ago, their official request came in on April 30th. The letter is attached to your packet, and I expected there would be a whole bunch of people here for public comment, but I was wrong. So, um, it's just an opportunity to talk about it and, um, ask any questions about how it's going to affect the budget, all, all that kind of stuff. So hopefully we'll start the conversation early.

Scott. Madam Manager, can you reflect a bit on how MAPTR will influence what we're able to give the school district? Yes, so MAPTR is our max allowable property tax revenue. MAPTR controls several funds but not all funds, and so it'll just depend on— we can adjust MAPTR and how, how much property tax we collect for bond debt because bond debt is outside of MAPDR, so it could affect it if we calculated it that way, or it could not if we calculated it a different way. So, um, yeah, it's a concern.

I'm more concerned about the school bond debt reimbursement and how that's going to affect— but yeah, that's, um, we'll have Dora talk more about that. But we do have a magical MAPDR Excel spreadsheet where we type in one thing and all the other things populate to tell us how we're doing with MAPTR. So it will just depend on what the assembly decides to put in our R&R and how much, if you want to increase mill rates or not. Thank you. Larry.

I know that currently on the statewide level, the governor is playing high stakes power. The governor is playing high-stakes power poker with the superintendents and the legislature related to a number of issues, and I was wondering what the difference was between what the current recommendation of Senate Finance Committee and the current amount that the school district built their budget, meaning if that passes through the— I almost said blackmail, but I didn't really want to say that— if that passes through at the current amount? What will be the difference in revenue? How will that affect the school district's budget?

I don't, I don't know if we have the CFO in the room, so maybe. So it is, uh, the current one that is passed is an increase of about $700 on top of the current foundation formula.

I think I heard $700. I think it's closer to $700. And then the $1.7 million to the school district. So essentially, instead of just looking at it, instead of a $5 million deficit, you would be reducing it to $3.3 or something like that. That's not exactly true, because if it's a permanent change to the foundation formula, some of that money is promised to the teachers, right?

Okay.

Do you want to come up so we can get it on the record, please?

Thank you.

Right, it's 50% is promised to the— if it's a permanent change to the foundation formula, they— not with one-time funding, but if it's a permanent change, half of that is promised to teacher salary. All—. Yeah, all employees. And it's written into the CBAs, employee salaries.

Go ahead, Cindy. Yeah, sorry, thank you. But while, while that's promised, it is part of our expenditures that's already written into it. And so the $1.7— we would still have a reduction of $3.3 million, but you're correct, in fiscal year '27 we would see that increase because we go back to the fiscal year '25 salary schedule for that bump in raises. I think the important part for us, as with the local contribution ask, is the ask doesn't change.

So if they get $340,000 or $700,000 or $1,500,000, they want the, the ask doesn't change. It doesn't go down if they get more money. So they're, um, when we were at the joint work session, they had a spreadsheet that showed you know, if we get the $340,000, this is what our budget is on, this is what the ask is. And then if we get $680,000, um, and our— their ask to us doesn't change regardless of what the addition to the formula is.

Any further questions of Finance Director Jared? Um, oh, for the Finance Director, um I think Larry asked my question.

I have other things, but I can wait. I'm right back there if you need me. Thank you. Jared, go ahead. Yeah, to the point that was raised about MAPTR and our ability to collect tax revenue.

Part of the problem also is that the— I believe, and you can correct me if I'm wrong— the local required contribution thresholds are determined by our property assessments. And so, right, so as assessments go up, the— that window, or that, you know, the the required contribution and the max keep shifting up, but our tax code is still set back here as that threshold moves up. And so—.

Right. So our— the window is based off the full value determination, so it doesn't care how many exemptions you have or how many nonprofits you have or how much land you have that isn't bringing in tax. It's just based off of everything that's in the borough? [Speaker:COMMISSIONER STEINGASSER] I mean, generally speaking, right, we need to do our diligence and I think— and honoring the full ask and find some ways to do that. So I don't know, am I jumping the gun if I say, all right, we need to start looking Can we ask about budget and what that will look like right now?

But I know that it's later on in the, um, agenda to look at a lot of those lines. So the— when we're looking at revenue, when we go over the revenue, that'll be our big discussion time. And in the level 2 manager's budget tonight, we took out 25% of the school bond debt replacement, just so you can see what that looks like. Yeah, so that's in there.

So that's my starting point, at least with this. I think— and may I ask or direct a comment or ask a question of the Superintendent? Yes, you may. If that's okay. Cindy, could you come up?

So I'm worried about— The— I guess I can take that back. I'm not worried about— so, right, we closed a school that was supposed to save us money, but we're asking from— or we're looking at, you know, honoring more money. So those are— I was talking to Amy earlier today about this. Like, that's a very hard, very difficult story to tell.

And yeah, so I'm wondering how do you approach that? How you can help us justify, right, the $12.9 million even though we've closed a school? Right. So our expenses keep going up primarily with personnel-related costs. One of the things with— and you brought it up earlier that the the contributions— minimum contribution is based on the full value.

And so while our ask is $660,000-plus more than last year, we actually lost more than that because of the assessed values in the borough. We lost a little bit more than $1 million in the state contribution because the state contribution went down because the borough's property assessed values went up regardless of you take in that money on your mill rate or not. And so, um, we didn't ask for that full amount we lost. We asked for what we needed to balance a budget. And so that's with us closing the school and reducing $3 million.

And using pretty much the majority of our fund balance.

But like Mr. Ledoux— Dr. Ledoux stated earlier, you know, we're kind of in a rock and a hard place. The governor met with all the superintendents today and pretty much told us that he was vetoing House Bill 57. And so we'll be going into a battle trying to get that overridden, not once, but probably twice, because he did, he did tell us that he would, if it was overridden in with the legislatures the first time, that he would reduce the allocations in the final budget. So, but that was him speaking with us directly today. Thank you for pointing that out, that that also decreases the state contribution also.

So it's getting— it's just going to get, I mean, extremely exponentially tighter and tighter for the foreseeable future unless we make some changes coming down the line. Um, okay, thank you, Steve. Um, I'm not sure who can best answer the question, but I've heard that fund balances are basically being used up. What is the projection of shortage? Do you have any for next year and how bad the situation looks?

I'm not getting a great feeling. Yes, we do have a projection of where we're looking with our fund balance. If there is no BSA increase, we will be utilizing our entire fund balance and we will actually go in the hole. Um, we will overextend ourselves. With a $340,000 BSA increase, that will leave us about $94,000 in our fund With a 6A PSA increase, that leaves us about $935,000 in the fund balance.

So as I read this, we better start preparing for next year being bleak and the year after being worse. And we have actually, at the superintendent's direction, I have started projecting the next couple years of where we're going to be with our, with our budget. Okay, thank you.

Larry.

Larry and then Jared.

So, uh, just to understand the dilemma, is your fund balance that you're talking about right now what you project to have at the end of this year, or the fund balance that you accrued from last year? Okay, um, so, um, if you get no increase, then your, your fund balance use will be much greater than what you just said. It will, um, no, if we, if we get no increase, it'll be what I said because we're projecting— this is the what we've projected next year for FY26. We are using— we are assuming that we'll utilize the fund balance that we projected this year. So we're working off a number assuming that we have utilized the fund balance that we put into the budget this year.

Okay, yes. Um, so let's say that you use $4 million fund balance to balance the budget when all is said and done. Next year you'll need that $4 million plus any increases due to personal. No, no, we will have— well, we're going to need the fund balance. Am I misunderstanding this question?

Okay, come on.

Yes. Oh, sorry, I didn't even know it was on. Sorry, Dr. Luedu, you're correct. So if we use $4 million of fund balance this year, then we would have to—. You—.

We would have to come up with the funds for that $4 million. On top of what we typically see, a $1.5 million increase in personnel-related costs. And so you are, you are absolutely correct. And that's why I've asked her to project out the next 2 to 3 years draining our fund balance, what that means for the district, and how much we're— what we're going to have to look at cutting next year, because that $4 million is into our expenditures And so we are not going to have that. So we would have to take the $4 million plus our personnel-related costs as additional cuts next year.

So— continue, Larry. So we could be in worse shape next year than we are this year. Oh, absolutely. We will be. Yes.

We will be, which concerns me. But I would also say that your request for an increase in borough funding is rather a bit austere considering the financial crisis you're in to only ask for that much, considering trying to carry that kind of fund balance is not really a balanced budget, as we all know. It's, it's a crisis budget, if you will. And because the reality is you won't even know how much money you're going to get from the state regardless of what the legislature does until probably December 1st. And then you won't know how many intensive funding you have until January.

So everything is a projection and you're hoping for the best. And this year we didn't get our intensive funding until April, end of it, middle to end of April. We just got our final number a couple of weeks ago. Yeah, I guess the concern that I have is not so much this year's budget, it's, you know, next year and the year after, as Mr. Ames pointed out, and at some point in time time, I suggested that the borough and the— excuse me, the borough and the school district get together and figure out what's going to happen, because our community—. Not the borough—.

Our community could be presented with an impossible funding need to keep our schools looking like schools if we don't do something. And so while we may go through all the funding and find out what the state's going to do, what the borough assembly is going to do, how many kids If we don't solve the long-term problem, this crisis is going bigger and bigger and bigger, and it's going to affect the quality of our schools. And I know you already know about that. So anyway, I appreciate your request. Jared.

Yeah, I think this seems to be a year where we really need to like hold the line on this ask because Someone very close to me works with school boards and tells me about school districts around the state that have overexerted themselves. And there are millions, tens of millions in the red. And what happens to that community, it gets ugly. It gets really ugly. And not just financially, but politically and civically.

When school districts have particularly have a difficult time crawling out of that hole.

We need to make sure that there is no hole. And I think that's, you know, if we're that last line of defense because of what the state is doing with their appropriations. And I think also, you know, I think we're getting screwed on PILT, you know, so You know, this is going to be a— it's an appropriate ask, but I think I feel more and more a sense of, you know, urgency about this year and the budget.

Any other questions or discussion?

Well, then at this time we'll go back to the first item that was on there, which is presentation from Building Inspector Ted Hanson regarding the mental health buildings.

Amy. Thank you, Mr. Mayor. On April 16th, Building Inspector Ted Hanson conducted a site walkthrough at our abatement and demolition project at Signal Hill. He's agreed to be here tonight to give the assembly a summary of his findings. Thanks for being here, Ted.

Good evening. Mr. Mayor, members of the assembly. Is that mic on? I just turned it on. Okay, thanks.

Might get a little closer. It doesn't pick up all the time. Thank you. That better? Yes.

Okay. So last week I did a walkthrough of the buildings before they had been completely cleaned up, and they didn't look good. And so I went back today because they moved everything out. What I see are some buildings that have been overloaded. They should have never been turned into business space.

They were designed as residential loads. And so the floor joists on the second floor— I did not crawl in the crawl spaces— but the second floor floor joists have obviously been overloaded over time. The buildings are out of 2x4 construction. Pretty nice-looking wood since they were built back in the late '60s, early '70s, based on the plan set that I saw was dated 1968. And there's a lot of— because they're 2x4s, there's a lot of framing that has been notched out, cut out, that would have to be replaced if you wanted to do something with the building.

The buildings themselves, their aspect ratio is really way out of whack because they're narrow and long. And so in a seismic event or a high wind event, they don't have any interior shear walls. So if you want to save the building, then you're going to have the expense of an engineer to review them structurally to bring them up to current code. My— I've been told that they want to go back to residential. But that now is a change in occupancy from them being business.

So that means that you can use the International Existing Building Code, that you get some relaxation in the code by doing so, but it doesn't relieve you of everything. The buildings would have to be sprinklered because they're residential. They exceed the amendment that the State Fire Marshal has for number of bedrooms or number of units.

The smaller building, the North Building, there was obviously some kind of moisture problem where the unit wasn't occupied. There's a bunch of rot in what would be the west wall, and a lot of mold in 1 or 2 units there. The South Building, actually looks pretty good. When I walked through it the first time, I thought, oh boy, when they open up and take the insulation down, that we're going to find a whole bunch of mold on the sheathing and stuff like that. And there wasn't any.

It was actually— it smelled a lot better, but it still has been all cut up, and you can put that stuff back, but it's going to be a lot of work to be able to renovate it. And it's really one of those things you guys have to make a decision It really needs a structural engineer to look at it. The foundations appear to be sound. The mechanical building that they did tear down, they couldn't break up the foundation with the hoe. They had to go and get a jackhammer and break it up in smaller pieces because the hoe couldn't break it because there was a lot of rebar in it.

So I would assume that the foundations for the two residential buildings are are also just as strong. They did put polyethylene Rhino-Hyde down in the crawl spaces to keep the moisture out, so that's good if you choose to do something other than tear them down. But one way or the other, there's a lot of expenses if you want to save them and turn them into something useful. Ted, in your opinion, What would be your recommendation be? I couldn't make a recommendation without you first talking to an engineer.

I wouldn't feel comfortable. I don't— I see them as possibly salvageable. It's just, it's the dollar value is really what you're looking at. What is this going to cost to do? And the buildings are— they have a potential insulation problem, but there are things you could do If you wanted to save it, you could do a remote wall system for your insulation.

So that means you put all the insulation on the outside, you coat the— you remove the siding and fix the sheathing that may or may not be bad. In some places, it was obviously bad because it was rotted on the inside, especially on the North Building. But you remove the siding, you put bituthene on the wall, that becomes your sealer, and then you put anailable base insulation on the outside, and that's how you provide the insulation for the building so you don't reduce the interior structure. But you're still going to have to do a whole bunch of structural sheathing because the buildings are narrow and long. And so I expect that— there's sound walls between each one of the units, in other words, double walls.

The plywood doesn't run all the way through.

Which potentially is a problem structurally, but you're going to end up sheathing each of those walls on each side of each unit if you choose to do it. There are reports in the file that there's headroom problems, and I measured off of the stairs, and the stairs don't meet current code as far as the width or also the headroom. So things like that would have to be modified, but they open two stairwells to each other. In the units and then took virtually all— made a long corridor down the center of the south building, the bigger unit. And so it's just, you know, it's one of those things is you've got to first come up with how much money is it going to cost to do it and do you have something that you can utilize it for.

If you do renovate it.

Scott. You mentioned in the report the interior brace walls were compromised and reduced the seismic stability of the building. On the first floor, they cut out— to be able to make a corridor down the center of the building, they cut those out. They can be returned. You can rebuild them.

But because of the narrow and long nature of the building, there are going to have to be— they're seismic— or they're brace walls when we talk about non-engineered construction. They're shear walls when we talk about engineered construction. But they're both the same thing. One just— they counted that there's more nails in it when it's a shear wall than there is when it's a brace wall. Thank you.

Larry.

Do you happen to know the current new construction square footage cost? Well, I can tell you what we use for building permit valuation, and I know that the actual construction cost is higher than that when we're talking about square footage. But the thing is, is they're also including the price of the land, which we don't include that in. And our current Residential is $238, I believe, a square foot is what we use for valuation off the top of my head. Well, the reason I'm asking is that it appears to me that the estimate that we have to refurbish them— and that was before some of the things that you said— is much higher than if we just erase them and start it over again.

Well, typically when you're talking about renovation, it's more expensive than new construction. You guys have already paid— I don't know what the bill was, but I'm sure it was pretty steep to take and take out the problem materials to get it ready to do anything with. And that's— so you've already got that expense. I mean, it's part of it, but it's out of the way. But yes, doing renovation, I can tell you, is always more expensive than building new.

I don't believe you can find an honest contractor that will tell you that it's cheaper to renovate than it is to build new. Thank you. Any other comments? Thank you, Ted. All right.

I appreciate it. Thank you for coming forward. Amy, anything else you want to say at this time? No, sir. Okay.

Then we'll move on to the budget review for general fund department. Several special revenue funds and several enterprise funds.

Okay, we're going to start tonight with our general fund. And for this conversation, we're specifically looking at revenues since you've already been through all of the department expenses in the general fund. So do you want to go line item through line item by this? Would you rather just ask questions? There are some easy things that I can point out.

We obviously have not gotten our federal PILT or our PILT from Alaska Housing yet. That's why those are both zeros. Will come in later in the year.

I did reach out to James Turner about our C products severance tax to talk to him about what he thought the projections were for the next fiscal year, and he helped us last year as well, so he helped us come up with that number again.

I think, I think on this revenue Page, we got some big dollar amounts on there. I think we should go through on the first part line by line on what they are just to put it into perspective here. And then as you get into some of the other stuff, I don't know, but we've got on the revenue side there are some very big items. So we bring in that $2.27 million. That's what we're estimating we'll have to bring in from property tax and $252,000 $2,628 from personal property tax in order to balance the budget.

We're estimating $17,800 we'll get for aircraft tax. We just talked about PILT. We're expecting $1.7 million from the federal government, $23,000 from KIHA, and $17,000 from Alaska Housing. For severance taxes for Sea Products, we're estimating that we'll have $700,000. For mining, $2,500, and for timber, $41,000.

Penalties and interest, $220,000. Dora told me that Carl Short taught her that if people paid on time, we'd have to raise the mill rate. I thought that was fun. Um, well, that's revenue. In licensing and permits, you'll see all the different kinds that we charge for We're expecting $65,000 for building permits, $4,600 for subdivision, $500 for conditional use permits, $4,000 for zoning compliance, $1,000 for a variance fee, $2,000 for electric permit, another $2,000 for plumbing permits, $800 for dog licenses, $200 for tobacco business license, and none we're expecting for marijuana business license, but maybe we'll be prize and someone will open a new dispensary.

For excise taxes on tobacco, excise tax, that is always a big one for us. We are— have $800,000 in the budget and there is zero under marijuana excise tax because that is only for cultivators and not for dispensaries.

Fund revenues for the ARPA money, that $354,000 Um, that was our health insurance. I just want to explain what that 2025 actual was. We're not expecting any more ARPA money, uh, right now unless, um, until we get to when we're actually talking about using that $4.7 million that we do have left. And then, uh, from the National Wildlife Refuge, our federal shared revenue, we're expecting $180,000. Our state community assistance Carluck program.

That's the cap that we've been talking about with Carluck. We expect $361,098.70 to go to the borough and $10,609 to go to Carluck. And they tell us exactly what we're going to get, so we don't have to do any guessing about that. Fisheries business tax, we are looking at $900,000. Business fisheries and landing tax, we're budgeting for $70,000.

Telephone and Electric, we're budgeting for $21,000. PERS on behalf will be $167,767. Um, and then go down to interest earnings. That has varied wildly. If you go back and look at 2021, our actual is $45,000.

We're hoping to come in over a million for for fiscal year '26. Um, we didn't have any gains or losses on sales. And then I want to talk just for a second about the change in fair market value. That $679,000 is an unrealized amount, but we have to figure out what our assets are worth on one day a month. And the day of the month that we run this, they had gone up $679,000.

Um, that's a— and I'll let Dora explain that more, but we don't— no matter what that number is, that is something that we don't actually realize, but that is an accounting rule that that has to go in there. Did I explain that okay? Okay. Um, and then we have some miscellaneous revenues. Um, jury duty— our CBA says that we will pay your, your regular salary for jury duty as long as you hand over the money that the jury duty pays you.

So the deal is very much in favor of the employee. So, so far this year we have gotten $550 from the state of Alaska. Thank you. And maps— we sell all kinds of maps to residents that come in, or the city, or whoever needs maps. So far, $279, but we're budgeting $500 for next year.

And on the last page Uh, we have IBEW reimbursement. That's for if our union reimburses, um, if we send people like our shop stewards to training, or sometimes if they wanted to have a meeting during the workday, they would reimburse that portion of salary for union employees. That has not happened in a few years. And we have operating, um, transfers in. We're not expecting any in 2023.

That was the state repayment of school bond debt when we got all of our money back. And sale of fixed assets, um, in 2024 we did do a sale, um, of all kinds of property and a very nice van. Um, and we haven't done anything this year except for a $100 amount. And since we don't have any planned, uh, right now, we have— we're not planning for any money for the next year. And that is the summary of the revenues.

Are there any questions?

Scott? I have a question.

On the— for the refuge, $180,000, how is that calculated? It seems—. I mean, most of this island is the refuge, so how do we get that number? So there's a difference in calculation between land we acquired and land that was given to us. And so there's a formula I can drag out for you.

Um, I, I've tried a couple years ago to nail it down. There's nobody to answer— nobody answers emails, nobody answers phone calls. They won't really tell you. It just drops into our account at the end of June. I mean, we haven't gotten it for this year yet because It doesn't come in until the end of June.

So it comes from the Interior? Mm-hmm. And there's no place to bitch about it? Nobody answered any of my emails a couple years ago. Tried.

And there's no contact me phone numbers. You know, the—. Well, it seems really low to me for the size of the amount of square miles that we have. It is. But you might be thinking of part of the money that's under federal PILT and not—.

I'm just thinking of refuge money. I know, but there's some of the refuge acreage is under the refuge program and some of it is under the federal PILT program, depending on how the acreage was— how we acquired the acreage. So we question. Yeah. So we do have $1.7 million for the federal PILTs.

Which is low. Yes. That's one of the—. Luckily, Mayor Arnt is attending all those NACo conferences, and that's one of the big things that they lobby for. Best resource.

Yeah, and we've been pushing for a doubling on the PILT. Is this something we want to go to the federal people? I mean, to Murkowski and Sullivan? We have. When this year when I was there and last year when Amy and I were there, that's what we requested of both senators.

Yeah, and it's not just Kodiak complaining about it. Southeast is complaining about it too. Similar. Similar. Yeah, and one of the things that hurts us is large area, low population.

And trying to change that formula, and that is one of the things that we are pushing for. Yeah, it's kind of a hidden problem. Probably been laid off. Well, no, Doge didn't get there yet. Amy, do you have something on there?

Otherwise, Jared's got a question. Oh, okay. Okay. So C products. We are collecting just a little bit under $400,000 this year.

The trend, it looks like, over the past few years is that it goes down pretty significantly. How were— how was— Mr. Turner, are your advisors advising that it might actually be a little bit more the same as 2025? Or— well, actually—. Are we talking about the 316.100? Yes.

Two products under severance taxes? Yeah. So last year, when we came up with that 720, James actually walks us step by step through the season and what he thinks the prices are going to be and how— where he thinks the fish is actually going to be landed and how much is getting processed offshore. So he has a— he walks through a pretty, um, elaborate, educated, elaborate step. Um, but believe it or not, Dora and I came up with almost the exact same number before we talked to him.

So I was like, I'm feeling, uh, happy. Um, and but he does— he knows it's going to probably go down, but not as significantly as we thought, um, just because it's not that big jump down as we've gone down from like '23 to '24. That was an abundance issue with all species. Like, that year hit us hard across the board. And so, um, he doesn't expect us to have like a significant downfall on all species again from where we're at.

So, I mean, based on the 2025 actual, he thinks it's going to go up if we're budgeting $7.5 million. Well, but 2025 is not over yet, and so we still have some money that'll go into that fund. Um, I mean, we think 45%, we're missing 45%. I think we're only missing 22%. Well, you're missing the third quarter and the fourth quarter.

Yeah, so there's two quarters missing. I gotcha, I gotcha. Okay, right door.

And I do think the end of the year is traditionally 40% of our take. Okay, that's okay. So that's good to know. Yeah, any other? Um, yeah, so, uh, timber.

Um, what are you hearing about timber? Because, you know, the story so far is that the tariffs have Essentially have hurt at least what's going on on the Fognac. But—. Luckily, our finance director's husband works at that exact facility. So I think our insider knowledge here is probably pretty strong.

I know they have volume they were going to ship and they stopped the shipment. I don't know which side shop stopped it, but they sent everyone home. They were just doing road construction and cleanup.

If they don't— if they don't— so the volume is unsold, as I understand it, at the moment, sitting in their yard. And if they don't get it sold and shipped by September, then they're done for the year and they won't they won't be doing anything because of weather. They can't get, they can't get the logging crews back because they've already found jobs if they're too, if they wait too long. So, and then the weather is a component at the end of the year. And even if they do get logging crews back up, it won't be until, you know, April of next year.

Next year. Yeah. Which should only be a couple months of the year. Right. For us.

Jared, anything? No, other than this isn't really too pertinent right now, but as we're thinking of revenues going forward, I think we should maybe look at some corporate excise taxes similar to what Seattle and Portland are doing.

And that would essentially be changing the business license. But anyway, that is all I have for now. Yeah. Okay. Amy.

Okay. The next fund we are going to look at, we are moving to special revenue funds. The first one tonight. Is Fund 254, the Airport Fire Protection Service Area. We are projecting $21,600 to come into that fund.

The collections from this fire protection service area goes to Women's Bay. The only thing that stays in the account is the interest. The interest stays in the account. So the personal property tax and the real property tax gets moved to Women's Bay Fire Protection Area. Any questions on that?

All right. Next is Fund 260. It's Woodland Acres Streetlights. We expect to take in $7,260. So far this year, um, What have we used so far?

We're at, uh, $4,700, just over $4,700. Um, the price of electricity, we are looking to go up a little bit, so you're going to see an increase. They don't have any— is that where we put an additional light, Scott? So one more light for next year? Yes, it's not in yet.

So, okay, but we did add a little bit of extra money in there, increase in electricity. Thank you. Any questions on Woodland Acres? Okay. Next, we'll look at Trinity Island Streetlights.

Same thing, smaller.

We are expecting a bill of around $2,500, and that— oh, we also do a general liability insurance coverage for that of $100. And the rest will go towards electricity.

Any questions? Continue.

Uh, this one will make some more questions. Uh, Fund 276 is our facilities fund. Um, we are expecting interest earnings of about $1.6 million in fiscal year '26. Um, So if we put, uh, $1.3— I'll say the whole number— $1,368,500 into renewal and replacements, the remainder of that money, that $241,500, goes in contingencies. Um, some people like contingencies, some don't, but we need to make the expense match the revenue, so that's how that lines up.

Our current rules are that 85% of that interest is available for use. We changed our code the last time we updated it. We changed it so we could use up to 50% of that towards debt service. [Speaker:ED] So that might be a place we make up some of the loss. Yes, and there were some comments the last time we talked about the facilities funds.

Um, one of the assembly members said like, when I pencil this on the back of a napkin, we should have so much more money. So tonight I just wanted to let you know, um, Dora looked up how much money we've taken out of the facilities fund. Um, we've taken out $3.2 million for building insurance, $10.3 million for debt service, and $8.3 million for capital projects. So we've had, uh, $21.8 million out of that fund going towards projects. So when we're penciling on our napkins, we kind of forget about the interest that we took out.

So just want to clear that up and let you know why that fund might not be as large as you think it could be.

Any questions on facilities? Continue. Oh, Jared, you got one. Just a very quick one. What's the size of the corpus on the facilities fund?

Our unreserved fund balance right now is $45.8 million.

You threw me with that corpus word there. Yeah.

Okay. The next one we are going to talk about tonight is the Tourism Development Fund, Fund 277. This is our accommodations tax. On-road system, we are expecting around $80,000 for fiscal year '26, and off-the-road system is $20,000 for a total of $100,000. That's just kind of an interesting way to look at, um, how much money is coming in from the villages versus how much is coming in from right on the road system here.

Um, and then the way that that money has been spent, you can see all the way from '23, '24, and '25 is we give the Kodiak Kodiak Island Convention and Visitors Bureau, $75,000. And then we have $25,000 listed in contingencies. That's the money that we have been giving or spending to have the front desk at the KFRC manned for cruise ships and during holiday breaks and stuff. No? She gave me a no-no.

Oh, we got zero. Next page. Yeah.

So that's $20,000 instead of $25,000. Yeah, we changed the amount of contribution to KFRC this year, and so normally it was $45,000, so we split that $25,000 into the contingencies for another activity or something if we open the building up to add more money to them later. But that, that was a change we made this year. Thank you. Jared.

I'm sorry, can you say that again? So $25,000 in contingencies just in case another activity comes up for the— gotcha, okay. Like Amy said—. Or longer hours. Scott?

Yeah, the balance of the revenue and the expenses. Yesterday, a school bus passed me with a whole bunch of old people in it where they had gray beards and gray hair. There was a cruise ship in town. So we're hiring The school bus company? We are not, no.

The cruise ship companies, so those people on the buses are paying for an excursion off of the ship. So the cruise line gets like $200 and then First Student will get like $85 of that for every person that gets on. So it's a, they do several tours, but one of them does include the touch tanks. So that bus you saw would have been hired by the cruise ship Okay, so, and they were coming from Fort Abercrombie. Are there other tours besides that?

You say the touch tank is one. The touch tank is usually part of one. They used to do a Russian tea tour. Sometimes later in the season, there'll be balika dancers. So there's a variety of stuff they do.

They do maritime history.

Yeah, and Abercrombie are usually the main ones. Okay, thank you. Anyone else have any questions? Continue. Speaking of cruise ships, let's talk about Fund 276, which is our commercial passenger vessel.

This is fees that we get from cruise ship passengers. The state of Alaska charges cruise lines a certain fee for the first 6 ports they hit in Alaska. So during this part of the year when ships are repositioning from Asia, we usually hit those first 6 ports, uh, when they are coming up from Bellingham or down south and doing the Southeast. Those few that come over here, we usually don't hit those first 6 because they've had too many port calls by the time they get to Kodiak. So, um, we are doing really well this year, way higher than we expected.

For the manager's budget, we went back down to $20,000 because that is a more accurate look at what we've gotten in the past. Historical. Yes.

Continue. Is there any questions on commercial passenger vessel? I'm going to go ahead and proceed. Okay. Next, we are going to talk about Fund 300, that is debt service.

So, and this is for schools, right? Debt service for schools. Okay. For real property tax, right now in the manager's budget, we are not planning on anything. That's obviously going to change as this discussion furthers for how much we're funding the school and how we're funding them.

For motor vehicle tax, you know, that's one of the things that we've talked about a lot lately that the community does not like. It takes $720,000 of the burden off of this debt, so it's very helpful. School bond— school debt reimbursement, what we get from the state, um, you can see that in the first version of the manager's budget, that was $4.2 million. Um, that would be if it was reimbursed at 100%. Um, our state legislators both believe that we will be at 75%, so in the Level 2, you'll see that $3.186 million with a difference of a little over a million.

That is reflective of that 25% reduction that we're expecting the state to take away. Uh, we will have to be using, in order to balance the budget, $34,620, um, of the fund balance. And then when you look at expenses, you're going to see a list of all of our bonds. You're going to see them twice. One is for the principal payments, uh, and you can see Um, for anyone who is listening, they are $395,000, $1.3 million, $1.4 million, $245,000.

The principal payments are huge, and then the second part is the interest on those same bonds. And so, um, there is $973,412 worth of interest that is paid on those bonds. So altogether, for debt service, when you add it all up, it's $6,167,862. In your packet tonight at the end, because that sounds so bleak, in the packet at the end there is a worksheet that shows you the bond debt, our, our school bond debt service obligation. Um, it's what the last two pages of this section— it looks like this.

It shows you how much we're paying on bonds and it has a couple of little highlighted ones, and that's the ones that I am, um, wanted to point you to because the payoff date happens in 2026, which means we'll see a drop in our bond payments as we go into fiscal year '27, which is always good news. Are there any questions on this? I just want to point one thing out. As you, you'll see in there the level 2 on the bonds, the $45,000 $13,000 increase, those are both due to the bond refunding. So, so those— that 2015 bond refund that we, we did is reflected in here as well.

And that is complete, or where are we at on that? Yeah, it's done. Good, thank you.

Not listed on the COVID sheet, but as a surprise, we're going to also go over Fund 560. It is in your packet. It's our 911 service. This is a pass-through account. Uh, the money that we get, um, all of the money that we get except for $1,500 in allocated salaries for this gets passed through to the City of Kodiak, and that's been I know we've talked about that in the past and had joint meetings with the city about how expensive that system is, and they would send us a bill that was larger than the money that we have.

We have worked that out with them that they just send a bill for whatever we get, and so their books are correct and our books are correct. So we've—. Finally, yes. Is there any questions about that? Okay.

Now we're gonna look at two enterprise funds, and we have the ENF director here, but he went over these with us like back in the end of January, so it's been a minute, so we'll see what we all remember. For the long-term care center, We have estimated interest earnings of $80,000, and we have lease payments of $1,043,628. Um, and then when we look at the expense side, um, we have $40,000 for property insurance, uh, we have $456,000 in contingencies. Um, we have $18,000 in depreciation and $106,000 in, um, debt service interest. The contingency fund again is just to balance out the lease payments, so we have to have an equal amount of expenses to balance out the amount of lease payments that come in.

Um, and that is one of the leases that we'll be working on this year to update along with the hospital lease.

Any questions about the long-term care center?

Jared. Um, can, uh, can you walk through the contingencies again? And maybe can we, like, this— can we look at, um, FY25? So, um, we, we budgeted $658,000 none has been used. So where, where has that— I don't think we're going to spend that, right?

By the end of the year, fund balance, or it just—. Thank you. Yeah, does it go straight to the fund balance? Since this is an enterprise fund, that money just stays right inside of there. Perfect.

Any other comments? Continue. Okay, uh, finally tonight we're gonna look at the Solid Waste Collection and Disposal Fund. It's an enterprise fund, Fund 530.

Um, Dora's trying to leave. I, I'm just going to cut in here for a second. I have been listening to meetings with APRA and AML/JIA, and in their merger There is concern. There's, there's, there's two distinct different ways that they base their property insurance premiums. One, AML/GIA, if you say you have a million-dollar building, that's what we list as the valuation, that's what your premiums are based on, is that million dollars.

And, and if it burns down and it costs $5 million to replace it, then you get the full $5 million to replace that building. Wow. APEI, um, they have a margin, 125% margin. So if you list that for a million and it burns down and it costs 5, they will only pay you 125% of that $1 million in order to replace that building. So in the merger, those are two very different ways to pay for premium-based system.

So they're going to— they're trying to work that out. They like the AML/JIA version. However, if they go with that, and I think they're probably going to go with that, they're going to require valuation updates for everybody. Yeah, because you can't afford that. Exactly.

And what that's going to mean, and there's some concern and talk about smaller communities that can't afford that premium. So they're looking at a way to make sure that the smaller communities, if they can only afford premium X, then they reduce— they sign an agreement and reduce the value of what they would receive. But that means there's— there's—. Exposure. There's some huge— we could have a huge jump in property insurance.

And I'm trying—. I'm on the list. For discussing having them coming— having them come down to evaluate our properties. And that's going to have to happen with all of their insurers. But I just want to let you guys know that's not going to happen before the budget's passed, so that could be a wildly different number.

And like most municipalities, they have very unique buildings. KFRC is a very unique building. I don't know how that's going to be valued. And some of our buildings are old, and I don't believe—. Schools are very unique buildings, hospitals.

Depending on how we renegotiate the lease, currently they are providing the insurance. The long-term care center, we provide the insurance. So there's— there could be some huge swings on the insurance side that We just, I just haven't a clue how that's going to fall, so. Yeah, just for everyone's information, AML, JIA, and the merger with, I always forget the other one. APEI.

APEI. And so the NUC is APRA, APRA, which will always, like Amy says, is always going to be ARPA. Yeah, the basically, What brought the merger about was losses on the parts of both of them. So something's got to change because they can't sustain the losses on it. So, well, Scott, insurance everywhere is going crazy.

You can't even get house insurance in Florida anymore. So it's endemic to the industry. There's a big problem. Yeah. Amy, I'll let you continue.

Thank you. So we're looking at, uh, Fund 530, which is our solid waste disposal fund. This fund, uh, has one revenue section, but then it has two expense sections. So one of the expense section is for the landfill and the other one is for the leachate treatment plant. So starting out with revenues, um, for penalties and interest that account holders pay, we are budgeting for $3,000 just like we did last year.

Except people have paid $17,439.89 in penalties this year. Is there a reason in particular?

We had some— we had some very large account payers not pay for months at a time that gained a lot of interest.

Hmm, okay. So—. And Dave had a comment on that, too. Yes, sir. Okay, um, for the ARPA money, you'll see in fiscal year '25 that we have $221,245.63.

That was the money that went in for items like the baler floor and the Bobcat that we used our last, uh, amount of funding for. PERS on behalf payment, $41,608. It took me until I was today years old to to understand what that meant. And so I feel like I'm gonna share my new knowledge. The amount that we have to pay in is 28.33% into PERS, but it's actually capped at 22%.

So that 6.33% that's over that we are required to pay comes back into these accounts. So when you see PERS on behalf, it's whatever is over 22% that year. So—. As long as the state funds it. You guys may all knew that, but I have always been a little bit cloudy on that.

Now we all know. Charges for services for dump fees for customers, our expected revenue is $630,000. From Alaska Waste, it will be $3,150,000. The Coast Guard, we're looking at $367,500.

Waste screenings, $25,200, and metals, $78,750. For interest, $35,000 in interest.

And then money coming in for recycling. We send our metals off, we get paid back money for those. We're budgeting for $50,000 this year. And to balance the budget, we're looking at having to use $144,592, and that is our revenues for the Solid Waste Disposal Fund. And this is where it splits up.

701 Is the landfill. Um, Dave, am I robbing you of fun here? Do you want to— I'm ecstatic. Okay, uh, so salaries Um, for the landfill fund for fiscal year '26 is $637,316.

Temporary help is budgeted at $40,000. We have $20,000 in for overtime, $25,000 for allocated salaries. Those allocated salaries are the manager and finance director. Cell phone stipends, $2,200. And then we have all of our stuff that we cannot control with taxes, uh, group insurance, retirement, and workers' compensation.

Uh, $75,000 for consultants. That is, uh, is that for planning our new cell? Well, hopefully. All right, that's good. Uh, and then we have that, um, on the next page too, design services for $50,000.

We are looking to design a new cell and a new asbestos cell.

Junk removal services, $5,000. Metal processing, $60,000. That's the contract that we have with Metson that we have so many containers a year that we have to ship off island. $15,000 For litter pickup. That is the— what we do with the the Chamber of Commerce for their litter, their youth, is that what they call it, the youth litter?

Summer. Summer litter patrol. Summer litter patrol, thank you. And then construction services, we have $100,000 in there. That is so we can make the new scale platforms around the scale.

We've had people come in, that's one of the things that the ARB just reviewed this week, and stairs going up to that. Uh, $7,500 for legal fees, um, $45,000 for senior citizen support. Senior citizens get a discount on their monthly trash bills. That's about how much it costs us every year to do that. And donated trash disposal, $140,000.

That's like, like the events that we just did, community cleanups and stuff like that, all the money that comes in. Support goods and services, uh, we have $500 in office supplies, $75,000 in operating supplies, $100,000 for hazardous waste materials, $500 for printing and binding, $500 for postage, $750 for dues, books, periodicals, um, $25,000 for machinery equipment that is under $5,000. We are budgeting $20 $1,000 for equipment rental, but as you can see this year we didn't need that. That's because we made those investments in those two new pieces of machinery last year. Um, then we will have, um, well, let's see, um, we got a discount, uh, for insurance of $612.

And I don't— we don't have anything budgeted for mobile equipment insurance. I don't— do you know what that is? It would be your vehicles. Okay. So the only vehicle out there is a flatbed currently.

Great. We have $3,000 in advertising and hearings, $10,000 for outreach. That's what SWAB gets for their public education piece, $10,000 in continuing education. There are a group of items that all— everyone goes through every year. You have to have your MOLO.

So that's your— there's a certification for— you have to have a minimum of 2. We have 3. Management of solid waste is what it comes down to, and it's through the— it's through a national society having to deal with solid waste. That's a requirement by contract as well as by our permit. And then there's another $5,000 for staff training.

We have $3,000 in there for traveler per diem, um, $2,000 for telephone communications, $30,000 for electricity, $40,000 for heating fuel, $30,000 for vehicle fuel. $15,000 For the water and sewer. We are looking at putting a new drinking water system out there. The Baylor building does not have its own running water supply, and they—. It doesn't have a potable water supply, right?

They can, they can flush toilets, but there's no drinking water in there. Untreated, untreated water. We, we do provide drinking water by getting 5-gallon drinking water containers for both this and also Litchi Treatment Plant. So the $15,000 is going to do what now? Well, $15,000 is— we have to also maintain the source system.

So we, a few years ago, ended up having to put in a—. Leach field. Leach— no, a— sorry. A septic system, so that needs to be pumped every X amount of years, so we're coming up. So that's part of it.

But we're also looking at potentially doing some type of a small system that we could purify the non-potable water through a small chlorine treatment system or something so there's potable water at the facility. [Speaker:COMMISSIONER HART] And then that will include a charge from the city for the water? We haven't been using. I noticed in years past there's no charge on there. Sometimes you just keep your mouth shut.

Okay, because it's non-potable water, untreated. Okay, snow removal. We have $10,000 in the budget for snow removal and sanding. Uh, you'll see— well, you've experienced this winter, so you'll understand why we haven't used a lot of that this year. $25,000 In for maintenance repairs, $75,000 in for baler maintenance.

Uh, we did not replace the gatherer, so we're going to get a new gatherer this year. We are going to look at the stability of the gatherer. We're also going to look at the stability of the foundation, the concrete underneath. Uh, it looks as though on this last rebuild we're seeing where there's some deformation of the frame of the baler itself. So that's something that is going to have to be examined.

We're also looking at— you continually looking at replacing strapper parts because the strappers are antiquated.

We have $75,000 for maintenance agreements, $10,000 for auto maintenance and repairs, $10,000 $10,000 for licensing and permits, $5,000 for safety supplies, $3,000 for credit card fees, $300,000 for recycling services, $4,200 for clothing allowance, and $2,500 for protective equipment. Wasn't the recycling— be it threshold contract more than $300,000? I have no idea what it was. I was not here for that. This was projected in December.

I think you might want to take a look at that, Amy. I think you're right because we have to include that CPI in there, so we'll take a look at that. Thank you. Okay, uh, next page we have our auto liability insurance for $2,500 and We have machinery and equipment. Amy, could you go back on the bottom of that page?

Is machinery and equipment at $325,000? Do you have it annotated? I don't. I— that's the one I just got to. Oh, it's not in the bottom of my page.

I understand. So you're talking about capital outlay, machinery equipment for over $5,000. Um, I have, uh, annotated a dump truck replacement. Yeah, the idea was to look at two dump trucks. We have a 2008 and a 2010, so they're both— the manual that I was always referred to for replacement was 10 years.

These are approaching 25 years, so we need to—. Or excuse me, say that again. 2008 And 2010 dump trucks. So they're used on a daily basis. We need to consider replacement of those strategic pieces of equipment.

And they're also getting more usage than they normally did because they're traveling further to go to the lower section of the cells. So they're actually getting more mileage now that they're older than they did previously. What's the condition of them, Dave? I would say Honestly fair. Okay, because part of the reason I ask is most in the construction business are not replacing them with new trucks because of the Tier 4 engines.

And I don't recommend that we get Tier 4 engines out there because you need to run them a lot in order for the regen system. So you're better off potentially looking at, you know, what's the condition of the motors. Both, you know, PACCAR, which is Kenworth, and Peterbilt, they're producing a tremendous amount of trucks with no engines in because people, contractors, are putting their Tier 3 engines in them. Well, you can take one truck down, but you need a replacement immediately. So at a minimum, you should look at one if you want to look at remat.

I will also say that Although we got a pretty good deal on the reman of the bulldozer, I believe that we did not get the product that we were told we were going to get because we have encountered multiple parts on that that were removed and painted rather than replaced as we were told they would. Have we mentioned that to the—. They have honored some of the parts. The starter, that went out. Things of that nature.

But, um, you're probably looking at sending them off for a rebuild, and we need to have something in place because we cannot operate with a single dump truck. You need one to haul and one to haul rock. Okay, Steve, if the replaced— because of the problems with the new diesels, have you considered gasoline? We've considered electric, we've considered gasoline. Um, we are running into the problems Mr., uh, Mr. Arndt has described with all of the equipment and the regens, which is why we actually traded a skid steer loader in a couple of years ago for an older model.

So there's, you know, all of this is on the table for consideration.

So, you know, it's just, yeah, I'm, I question replacing both of them, you know, and look at maybe getting one, but it may, it may be that buying a, I'll say, remanufactured truck is going to be a better deal with a, with a Tier 3 engine rather than a Tier 4. Respectfully, we have been replacing equipment on a regular basis that had not been. If I don't ask for it, I don't hear a no or a yes. So these are the next two pieces of equipment that logically should be replaced because of age and use.

Any other? Jarrod. Just a little bit up the page. Can you talk more about the maintenance agreements that line item is? Jumped significantly.

So maintenance agreements are, um, we, we've been having to bring more consultants in for baler maintenance. Um, we bring folks in to— we primarily heat with, um, used oil, and those used oil burners are a high maintenance item. Sometimes our guys can take care of them, sometimes they can't. Um, we have maintenance agreements that for our electrical. There's this funny thing about a sanitary landfill.

It's full of rats, and they really like electrical wires. So consequently, they continually get inside the baler mechanism. And I'm not sure if Mr. Ames has helped with this, but we have quite a bit of electrical issues going on out at there, out at that plant. So what is— what, uh, so what is different about this upcoming than previous years? Because I think last year was budgeted $25,000.

I think it's just age is what it comes down to and trying to anticipate as things age. We have a few garage doors that probably need to be replaced, things of that nature. That's not a job we would normally do. Gotcha. Steve, on the baler, you talked about the strapping thing and having trouble with parts and it being old.

Is it getting to the point where it'd be more cost-efficient to replace it? We have a second strapper. We're actually— I'm waiting for a price for a technician that's an expert on the strappers. As long as we can— the newer the piece of equipment, the more the electronics, the more they go down. So consequently, as long as we can maintain the strappers that we have, we're better off, and our people are familiar with rebuilding them.

Do they hate me for it some days? Yes, they do. But in the long run, it's more cost beneficial to the operation. Thank you. Anyone else?

Jared, just before we move on to the, the landfill, and I must have I just missed this maybe when you were talking about it. Oh my gosh.

Under revenues, because this is connected to, I think, maybe the new equipment line too. So we have budget at $144,000 from the funds—. From the fund balance. That is, you're intending that, like, what, what, what, what needs to be balanced that we have to dip into the fund balance, I guess, is what. Okay, does that make sense?

So that's the other— so there's, there's two different plug numbers, one for the revenues and one for the expenses. Contingencies is for the expenses and use of fund balance is for the revenue side. So if my expenses are more then, then I put the difference in that use of fund balance. If my revenues are more, then I put it in the contingencies. No, yeah, no, I, I understand that.

So what I guess I don't understand is why, um, what is it about the expense side that we've seen equipment so far? Is it, is it— that's what I was—. That's—. Yeah, getting— yeah, kind of asking about like if, if we need to balance —this without using the fund balance, then, yeah, we would look at that.

Continue, Amy. Thank you. So we are at depreciation for the landfill, for building site improvement, machinery and equipment. We have depreciation total of $169,592. We have debt service interest for loan interest and revenue bond 2011-3 interest for a total of $28,878.

And that is the end of the landfill portion of expenses. When you go to the next session— section, you will be going to the leachate treatment plant expenses. We have budgeted $186,988 for salaries, $50,000 for temporary help $10,000 for overtime, $3,000 for our cell phones, and then we have all of our taxes that we're going through. Uh, professional services, $20,000, that's for programming. Uh, contracted services are $50,000, design services are $10,000, construction services at $50,000, that is for air balancing and chemical pretreatment.

Uh, when we go to support goods and services, we're budgeting for $25,000 for operating supplies, $85,000 for chemicals, $300 for printing binding, $500 for dues, books, and periodicals.

Uh, machinery equipment, um, we have $50,000, um, and that is put in there for critical spares. I don't remember what critical spares, Dave. Well, you're always having to replace your motors, um, your, um, various drive motors. Um, so it's, you know, we try to keep these on the shelf. They're also— we rebuild as much as we can.

However, we're— everything is redundant. We have 2 of everything. We have 4 air blowers. We want to make sure we have a motor or whatever pump is required so that we have an on-the-shelf replacement that we don't have to take the process down.

For equipment rentals, we are budgeting for $5,000. For continuing education, $4,000. Uh, travel and per diem, $3,000. Telephone, uh, $2,500. Electricity, $95,000.

Uh, we added a new load process this year, uh, which is why we're going to see that go up a little bit. Uh, fuel for vehicles, $2,000. Snow removal and sanding, $5,000. It was very nice to see a zero there this year. Uh, septic tank disposal, $4,000.

Maintenance and repair, $35,000. Building maintenance and repairs, $10,000. Auto maintenance and repairs, $5,000. And licenses and permits, $10,000. Our permits will reissue on 6/26.

That's why the increase? Yes. From $2,500 to $10,000? Yes, sir. Thank you.

Uh, $5,000 for safety supplies and $1,400 for a clothing allowance. Uh, we don't have anything this year for auto liability insurance. I don't know why. Yeah, to look at that, uh, we'll take a look at that because I don't think the insurance is going away. Uh, for machinery and equipment, uh, we have $200,000.

Uh, we are looking for an Extended forklift? Extended boom forklift that will be utilized for both the leachate treatment plant and the landfill and probably other locations if we need to transport it.

It's a nice— it's a nice wish list item. It is, but if you want to maintain your facility, you know, there's these crazy little eagle things that fly around and and seagulls, and we should be washing the roof off at the Baylor every year. We should be washing the roof off, and rather than renting the equipment, if we have it ourselves, we can use it to change lights in the parking lots out here, do maintenance over at KFRC, loan it to the school district if they require it. Yeah, that's why I say it's a wish list, because there's plenty of them also to rent in town. And ownership is not cheap.

Well, when they're available, you can rent them. If you have a big construction year, forget it. Yeah, right now there's 6 more in town than last year on it, so it's just something to consider on there because the need for that has been there for the last 10 years. And so, well, um, I'm just saying that it's something— it's nice, but the landfill paying for all of it, I have a little bit of an issue for. So my— and that can be discussed.

So when we develop these budgets, it's only fair of me to speak to the staff. And if I don't listen to the staff, this budget is not reflective of the people who are doing the work. So that's why some of these items are in here. Larry, I want to go back to the dump trucks a little bit, and really it's a question about equipment. Times are tough.

We heard from the school district that we're running into deficit funding and excessive use of fund balances, which imperils the financial future of both our borough and the district. So whenever that happens Um, then you look at some of the necessary equipment that we need, like dump trucks, and you said 10 years, but they're 25 years old, if you will. And that sort of, uh, sets out the real problem, that sometimes when we need the equipment, especially expensive equipment, it always falls victim to, um, the day-to-day operations. It has to until everything breaks, and then I don't know what a dump truck track rental costs, you know, but I suspect it's spendy. Is there any way that the accounting gods will allow us to start putting money aside into a special account that is specifically— and I realize we could probably change it at any time, but if we need a dump truck every 10 years or 15, that within our budget we we would set aside money to buy this machinery instead of having this big $200,000, $300,000, $400,000, $500,000 bite that we can't afford anymore.

And when you're looking at laying off people, you're not gonna buy the dump truck. You're gonna hope it lasts another year and it'll go away to a different assembly. And so is there any way that we could plan for the future, just like a person does buying a car? You set aside money until you have enough to purchase it. That's what the depreciation is, Larry, and it goes into fund balance.

Well, this is also an enterprise fund, so it's like the— if the school district was asking for $20 million, it wouldn't affect this fund, right? So, um, what we would want to do is maintain the— or take a look at how much money we're charging for disposal. So we're at $355,000 now. 365. 365 Now.

So close. And so if we're finding that our expenditures are more, you know, like our expenses are more than what's bringing, than what's coming in, then that's when we start looking at how much we're charging for disposal. And we're currently the highest in the state. We, we might be the highest in the state, but we currently— hold on, I need my glasses for this one—. For municipal solid waste.

We're the highest in the state. Right. Our fund balance for this fund is $303,000, so we don't have a lot of money. So is that after the— or is that before the budget adjustment on the upcoming budget adjustment? This is what is in there as of today.

Today. Okay, so there'll be another— what was that? Uh, what's that, Dora? So the, the budget amendment is just moving from $490,000 to $530,000 capital fund project to the solid waste project, but the number she's giving you includes that number even though it No, you haven't done that yet. Okay, that's what I'm asking.

Even, even moving that, it's not going to change the number she just gave you. And repeat that number, Amy. $303,510.09. Thank you. That's the fund balance.

Appreciate it. So that, that includes that budget transfer, so that won't That won't add anything more to that. So when we do talk about that, the third quarter budget amendment, you'll see that we're moving $1 million, but that, um, this is a cross-fund report, and so it doesn't change. That's why I was asking, right? Yep.

On there. So anyone else have any questions right now on there? Continue, Amy. Thank you. Um, we are to the automotive line where we are budgeting for $50,000.

We have a 2017 pickup that transmission is going out. Um, Dave, you have anything to add to that? No? Okay. Uh, for depreciation, uh, we don't have anything in there right now.

Um, we'll take a look at that though, right? Because That's normally what we would do, and that's what—. Yeah, we also didn't have any for '24 and then almost none for '22, so it seems like every other year we don't have any. So I'll figure out why that is. Well, I'm, I'm seeing the amended budget for 2025 has it in there.

It— so it's like the odd years we have it and the even we don't. So I'll figure out why that is. Okay. Thank you. For debt service for interest, we are paying on 2 loans.

The total will be $134,497.

I think that's it for that fund. Okay, thank you. One of the things that, that comes to mind is sometimes the state has some loan forgiveness programs in— I'm gonna call it solid waste or whatever— on there. So is there any chance of us getting something like that to help reduce our expenses on the most expensive landfill? Jen and I went to environmental conference at the beginning of February before I was gone for a bit.

And we actually spoke with several folks from DEC, and I will be approaching the manager about having a trip for the two of us to Anchorage to sit down and talk with the loan folks specifically about debt reduction and loan forgiveness. Those programs do exist, and I think we should— I think we should send staff up there and have a conversation because we have a very good reputation with them. Otherwise, we would not have been invited to the environmental forum to make presentations.

I appreciate it. Thank you. Amy, that is the end of our budget presentation tonight if there's no more questions about the solid waste disposal fund. Okay, we're gonna take a 7-minute break.

Okay, we'll go ahead and reconvene the work session. Next is packet review. And the first item on the packet review is awards and presentations proclamation recognizing June as LGBTQIA+ Pride Month, uh, Community Cleanup Day and Household Hazardous Waste event presentation, um, and we have public hearings, so We will go to staff report on the budget amendment. Amy. Thank you, Mr. Mayor.

This is the third out of four quarterly budget amendments that we do throughout the year. Um, the ordinance presents the net changes for additional requests which occurred during the current fiscal year for items or circumstances not known or expected during during the initial creation of the fiscal year 2025 budget. I think the easiest way to go through this is to go through the ordinance itself. Would you like me to go through the line items? I know that you did that 2 work sessions ago.

I'm happy to do it now, or we can do it during the regular meeting. I don't have a problem with this waiting, anyone? And just go through in the regular meeting so it's on the record? Yeah.

Any questions? Anyone have any questions at this time? Seeing none, we'll move on to contracts. Contract number FY2019-10U, change order number 21.1 for the North Star roof and skylight replacement structural design with Jensen Yorba Wall. Staff report, Amy.

Thank you. We received direction to modify the design for North Star roof and skylight. The modification removes the replacement of the skylight with a newer skylight feature and instead structurally replaces it with a closed-in roof to reduce the risk of future leaking. Our engineering and facilities director is here tonight to tell you more about that design and answer any questions you might have.

Effectively, what this means is that the gable ends that are existing will remain. Those windows will stay in. The proposal is to remove the glass that's in the rest of it, the glazing units, utilize the structure and put insulated steel panel and close in that structure. Because there is sprinkler system inside, and I know there was a discussion regarding whether or not that should be removed. Any type of removal will then modify— potentially modify the structure and have to put column support within the building itself.

But at least it would have to be looked at structurally by an engineer to see if the loads would transmit. Right now, this is simply putting a solid roof over windows, so you're not changing the structure effectively.

On there.

Yeah, boy, this was heartburn. Um, and I admit I've had an aversion to that skylight since the day it was designed in there, and unfortunately it lived up to all of my expectations, which was a continual problem, continual leakage, continual heat loss. Now we're looking at that not being a school, and after the ARB meeting— when was that? Days run together— this week here, Tuesday, one of the members came up and said, what does the borough want us to do? What does the assembly want us to do on this school with the use?

Potentially changing. And so I basically bring that forward to you now because as we're going forward, it's still remaining a skylight in the form of a big, I want to say, skylight structure that's there, reduced exposure on it with windows on each end, but you're heating a lot of cubic feet and you still have a a heat loss on there, and I question whether you take it off completely and either go with a— there's two roofs from one side of the skylight to the other— whether you go with a metal roof and metal roofing on it because of the steepness, you don't go with the membrane, and or what's the most economical thing to do since it's looking at not being a school. And then, Dave, the other thing that comes to my mind because we're looking at replacing some, if not all, of the PVC roof is that roof, that PVC roof was sold to us as a 50-year roof, and it has not been but 35 years. What are the issues on on the PVC portion besides the blasting that took place years ago and put holes? Well, I, I don't believe that there was proper maintenance done for that roof.

And if you're not up there continuously patching and looking at that roof, the other part is that, you know, we have roof failures all over. We have roof failures. We're doing warranty work on high school roof, and how old is that high school roof? It's— it could be the nature of the product. I had nothing to do with the design or the construction.

But the other thing I will say, I'm not trying to rebut— rebuff you or say anything, but we come here, my department comes and presents what the architectural review board has recommended to us. So consequently, that is what I have to come— because that is a board that is appointed by the assembly, by the mayor, by the assembly, and we are given direction by them. So consequently, that is what I'm doing as far as toward this amendment and this skylight, right? But they also received— that's the information they received. It was going forward in that way.

I'm just saying, as not be in a school, we might want to have a discussion on how much money we want to spend and what are our options there. Well, I believe at that meeting that you attended, right, there was a discussion about this, and the board voted after that particular discussion to move forward in this manner. We can, we can always change. That's right. And that's why we're here.

However, That would have been a recommendation most likely should have been by the ARB to this department. Well, I think it's also for the Assembly needs to look at that. It's going to be saving money, so we need to take a look with the use changing. Steve and then Jared.

I guess the ARB is who made the recommendation. By doing this procedure, Was the leaking due to the glass sections or part of the structure itself? And are we convinced if we just cover, will it alleviate the leaking problem? We will not. Well, the idea is this is part of a larger roofing project, so that would address your concerns about the— and, and Scott's concerns about, you know, the warranty of roof and the integrity of the roof, because now you would have a renewed roof that would have a warranty that is enforceable.

And hopefully, Borough, School District, whoever is the owner and maintainer of the building develops a relationship like we do with the, the two, the most recent roofs where we have, um, we have contractors that are indeed upholding the warranties and are performing the work, and we're trying to do that as quickly as possible. And I think it's a matter of keeping better track of our facilities and doing more regular identification inspections.

Jared, um, thank you. I, uh, I just finished like final grade, so my brain is noodle It's just all noodles at this point in the week. So can we back up, like, and help me understand? Can we back up a little more history and context? So, like, the genesis of this contract, it looks like it's a very unique and special kind of contract.

It's like its initial intent specifically as it regards the skylight? What was the genesis of this special kind of contract with the architects? [Speaker:COMMISSIONER MAY] Well, I believe the architectural design contract in general, the larger contract, this has been going on for a couple of years, so the main contract just changed. So now this is specific the, the skylight itself, because there has been controversy over what does this look like at the end. When it was a school, respectfully, you need to speak to the owners, and the owners and the occupiers of the school were absolutely in favor of that because it was part of the character of the school.

And I believe what Mayor is referring to is maybe there doesn't need to be so so much character. I think what the architects and engineers are saying here is that by removing the glass, which I didn't totally answer Steve's question, the glazing was a majority of the problem. And I can't fault school district from doing this. We had very similar issues out on the base when I worked there with clerestory windows. On the hangars and things of that nature.

It's just— it rains a lot here. So personally, I can't believe we have flat roofs. In this particular case, the recommendation is they believe it would eliminate the leaking through the skylight itself by removing the glass, the exposure, and going to a solid metal roof because metal roofs are proven and you can't have the composite roof buildup on that steep of a gable. So consequently, if you're going to leave the structure, it would be better to put that there. I'm not sure if that answered your question or not.

No, I— we got to the point where I wanted to get to anyway. And when you say the recommendation came down, was that by— The architects or is this ARB? The architects— the architect is who brought up this methodology. The ARB was the body that had the concurrence, which is why we are moving this forward. Okay.

All right. Larry.

Just so I understand completely, you are not talking about replacing the windows to put a square insert where the window would be— you're actually going to cover the whole structure. If you look at— think, think about a doghouse. You have two gable ends on a doghouse. Currently, that doghouse has glass on the front and the back, but it also has glass on the top and the sides, right? So they're talking about removing all of the glazing on the top and the sides but leaving the two gable ends because those ends are not leaking.

Right. I just want to make sure that there, if you look at the grid, that they're not going to pop out a window and then put a solid piece of metal within the grid. They're going to cover the grid. They're going to remove all of the exterior flashing. They'll likely recommend, and this is, this is my guess, they'll likely recommend steel studs.

They'll probably put some type of insulation in there, put metal on the outside, both siding and roofing. And then likely drywall on the interior. One of the reasons they're also saying this is because if you get rid of that, you also have to modify the sprinkler system because there's a sprinkler line that runs right along the bottom of the ridge.

You know, I went to Northstar, I think the second year they opened, and the roof was leaking, but it was leaking all the way across the the commons, and the rain was coming down through the skylights following beams and then leaking, which is sort of interesting. And some of the damage to the roof was caused by the fact that they put the oil tank too close to the building, and the kids were climbing up there on the weekends and the evenings and having— playing soccer on the roof and doing things like that. But from my point of view, as far as the integrity of the school and what it looks like, I think the most effective, cost-effective process we should use. But one of the questions I have is, did the Architecture Review Committee discuss the seismic implications? Because that roof is part of the whole seismic nomenclature, if you will, of the building.

Have they considered that? [Speaker:PB HARMON ZUCKERMAN] I think that's part of the reason why the architects and the engineers are saying to basically leave the structure intact and improve the quality of the materials that are on that because you could— you're not changing the dimensions, so maybe you don't have to go down that in analysis path.

Okay, well, I hope you take care of the fish in that building because we paid $700 of fish from that. Amy and I need to have a conversation as far as what the school district is responsible for removing, so they may end up being in her office. I'm not sure. There's $18,000 worth.

Next item is Resolution Number FY2025-18, approving certain unincorporated communities and their respective Native Village Council and/or incorporated nonprofit entity for participation in the FY2026 Community Assistance Program. Staff report, Amy. Thank you. This is the annual resolution which certifies the Native Village of Karluk as an unincorporated community of the Kodiak Island Borough and confirms they meet the Community Assistance Program eligibility criteria. The assembly is certifying two of the state's program's criteria: a minimum population of 25 and at least 3 of 7 listed services are provided to residents.

Documentation for those two items are attached. You're going to find the actual resolution, an email from the Department of Commerce, Community and Economic Development that says— verifies the population and what the payment amount will be, then the actual application, and then there's the rules in there, what the eligibility requirements are. This was a hard-fought application, so thank you to Dora for her consistent trying to get a hold of the folks in Carlock to make this happen. So we're happy that they made it in just in time.

Any questions? We'll move on to ordinances for introduction. We have, uh, 4 of them, uh, for the meeting. The first one is Ordinance Number FY2025-17, an ordinance of the Assembly of the Kodiak Island Borough zoning a portion of Tract E, US Survey 4793, from single-family residential district to industrial district. Zoning will correspond to lot created by abbreviated subdivision S-25-7.

Amy, staff report. Thank you. The Planning and Zoning Commission held a public hearing on April 16th on the proposed rezone and recommended it move forward with a vote of 5 to 0, with 2 members absent. The request is to take an R-1 single-family residential lot to an industrial lot. 69 Notices were mailed to surrounding property owners and no book at the public hearing.

Our Community Development Director Chris French is here tonight to give you the details about the rezone.

Thank you, Mr. Mayor, Assembly. So this particular rezone started with a subdivision plat, as the mayor mentioned in his reading the title. Staff approved abbreviated subdivision plat under case number S-25-007. That creates—. Or that will be creating the lot that is being proposed for rezone.

As part of staff's analysis of this, we looked at the existing use of that structure that's going to be on that new lot that's created, and that structure is being used currently right now as a seafood processing facility, and therefore, it requires industrial zoning. As part of the subdivision approval, staff had a condition that they file for a rezone from R-1 to the industrial district, and that's where this proposal has come from. As part of your ordinance, there should be an exhibit which is the exhibit of the approved abbreviated plat that shows you the lot that's being created and that is proposed to be rezoned to industrial. If you have any questions, I'll be happy to answer those. Any questions?

Seeing none, thank you. But next one you'll want to comment on too, so stay close. Next one is ordinance number FY2025-18, an ordinance of the Assembly of the Kodiak Island Borough zoning a portion of U.S. Survey 4793 Tract E from R-1 single-family residential to B business district Zoning will correspond with lot created by preliminary subdivision case number S-25-6. Staff report. Amy.

Going to sound like I'm repeating myself, but the Planning and Zoning Commission held a public hearing on this rezone request on April 16th, 2025. The commission voted 5-0 with 2 members absent to recommend approval of the rezone request to the assembly. 69 Adjoining property Property owner notices were mailed. No one spoke at the public hearing. Our Community Development Director Chris French is here to tell us the details.

Good evening. The Planning and Zoning Commission reviewed the subdivision request to create the lot that's being proposed for rezone. As part of staff's review of that subdivision, we recommended and added a condition of approval with the approval of the Commission that the property be rezoned or that property being created by the subdivision be rezoned to the Business District. The reason for the Business District zoning is the proposed use of the building. Besides being the tsunami shelter for Old Harbor, it's also being used for offices both for the City of Old Harbor, for the Native Village of Old Harbor, and also for the Native Corporation of Old Harbor.

That is why the Business Business Zone is required. If it was just government offices, that could be under the Public Use Land District. However, using it for commercial would require the Business District, which also allows for government offices. This particular rezone went at the same time as the subdivision case. The reason this subdivision went to the Commission was it's creating a right-of-way, Tsunami Road, in front of the proposed lot, and so it requires approval of the Planning Commission.

And the Commission voted to approve that subdivision with its condition of the rezone, reviewed the rezone at the same time, and as the Manager pointed out, they did recommend 5-0 to the Assembly to approve the subdivision from R-1 to the B Business Zone. If you have any questions, I will be happy to answer those. Seeing none, thank you. Thank you. Now we will move on to Ordinance Number 2017-02.

FY 2026-1, first one for next year, adopting the budget for fiscal year 2026 and appropriating from all borough funds. Staff report, Amy. Thank you, Mr. Mayor. The fiscal year 2026 borough budget as offered for introduction is a balanced budget, meaning the proposed expenditures do not exceed anticipated revenues and planned use of fund balance. This will be introduced at next week's meeting, uh, so that it can go to public hearing on June 5th for approval ahead of our June 10th deadline.

The resolution is required by Alaska State Statute 2945240 for the levy of taxes, will be done, um, in the next ordinance we'll look at tonight, fiscal year 2602, per Code 3.25.1010. The ordinance will be considered at the assembly's meeting on the 15th, and both will be hopefully approved at public hearing on the 5th. Thank you. Any questions? So the, the numbers that are in the ordinance right now are from the manager's budget, and so obviously some of those numbers are going to change change with the updates that we talked about tonight, not having insurance on a couple of places.

And, and so depreciation— and yeah, there— oh, well, I— Dora explained that some years when we're talking about the rates for the landfill, the assembly does not want to know about depreciation because they want to know what the actual cash balance is in there. So they don't want to take depreciation out, so they ask for that to not be in there. And the fact that it just went even year, odd year is just a coincidence. So it's up to the assembly on how they want to evaluate, um, if they should raise the rates at the landfill or not. And that's been assembly choice as those different years have gone by.

Thank you. Any questions? Moving on to the next ordinance for introduction, Ordinance Number FY 2026-2, receiving the 2025 certified real and personal property tax roll, levying ad valorem property taxes for tax year 2025 consisting of an area-wide tax— isn't that certifying '25? Okay, I always have to get that in there— consisting of an area-wide tax, Woman's Bay fire area tax, Woman's Bay road service area tax, a Bayview Road service area tax, a tax in Fire Protection Area Number 1, a Monashka Bay Road service area tax, a tax in Service Area Number 1 roads, a Woodland Acres Streetlight service area, a tax in the Service Area Number 2, a tax in the Kodiak Island Borough Airport fire service area, a tax in the Trinity Island Street Lighting Service area and a tax in the Mission Lake Tidegate Service area, levying commercial aircraft tax, providing for the collection of taxes due in 2025 and setting the date when taxes become delinquent. Staff report, Amy.

Thank you, Mr. Mayor. Uh, when the packet was due, we had not certified the tax roll yet, and so you will see a lot of X's when you look at the ordinance. The tax roll was certified yesterday, so thank you to Sima and her team. I think that Cody got to sit at the desk and actually do it, and so we have two people that now know how to certify the tax roll, which is great.

So now that the roll is certified, tomorrow or Monday before NOVA republishes the packet for next week, those numbers will be thrown build in so you can see, uh, what the, um, amount will be levied in each one of those areas. The one part that we will not be able to fill out immediately is what the, um— oh, we can't do any of it until you set the mill rate. So we will know the value for each area that's broken down, but until the mill rate is set, we won't be able to find out how much money is going into each area, correct? Any questions?

Moving on, the next thing is an executive session, and this will be for the borough manager's performance evaluation. Next item for the work session here is manager's comments.

Thank you, Mr. Mayor. I attended a CIP meeting today today with the Kodiak Island Borough School District, uh, maintenance staff. The assistant superintendent was there, um, and we talked to Deed about the North Star Elementary siding and window replacement project's eligibility for reimbursement. Uh, we were told that $867,000 of that project is, um, possibly reimbursable. They mentioned 70% of that.

I talked to the superintendent in a meeting today, um, and we got a name of who to contact DEED to find out if any of that money will be coming back to the borough. If it is, I already asked the superintendent that it gets directed towards the east roofing project. Community meetings, I met, just mentioned with the superintendent, also met with Northrim Bank and Alaska Airlines this week. The mayor was also there for the Northrim and the Alaska Airlines meeting today. We already talked about the local contribution contribution tonight, and we talked about Senate finance, and you see that that was incorporated into the Level 2 budget when we went over it tonight.

Last week we talked about standard operating service procedures for road service area boards. I found some very good examples from other communities here in Alaska, and I am shamelessly using their work and adapting it to the Kodiak Island Borough. So Once I get that done, I will have engineering facilities staff review it. We'll send it out to the service area boards and have them review it, and then it'll come to the assembly. That'll answer some of those questions about the roles and responsibilities of board members and service area chairs, and just some of the ways that road service areas work about how often they have to meet.

It just lays it out. Um, it pretty much is a document that quotes a lot of code, but it'll make it easy. It'll be something that we can hand to everyone and they'll understand the different things. We are currently recruiting a maintenance mechanic, an appraiser tech, temporary laborers— two of them actually— and an accounting technician, um, for accounts payable. We do have two people who applied for that job, so we're hoping to be able to hire one of them.

And in community development, we have our a preliminary draft report for the hydrology and hydraulic study for Russian River and Sargent Creek. Staff is going to review the report and meet with Rigger River Focus with comments. They had a list of questions that they asked, and I think Chris has already finished those and got them back. Once the final document is done, we'll bring it to a public meeting to discuss the results. They shared all of their drone footage with us and all of the tests that they did, like way beyond what's going to be in the report.

So there's some really neat information, historical information about how those rivers and creeks have shifted. The Planning and Zoning Commission will hold a work session on May 14th. The commission is going to receive training from the Community Development Director on meetings, motions, and findings. In addition, the commission is going to review an amendment to to address assisted living facilities. In the packet review for May 21st regular meeting, the commission is going to review two items that will be in public hearing, a variance for the Maritime Museum and a review of a code amendment on pet-related uses.

In finance, there's no changes from last week. Uh, we are stuck at that 22%, and our go-live date for the Tyler transition is in September of 2025. Um, we, we moved it to September 2025 so we would not be in conflict with the August 15th tax payment date. Uh, we are getting closer to the electronic timesheet implementation. The hardware is here.

In assessing, staff mailed 38 letters to applicants that did not file for the PFD and 34 denial letters for senior citizen and disabled veteran exemptions. Uh, the Board of Equalization met on Monday They did 4 value appeals, and then they met on the 6th to certify their actions so that the roll could be certified on the 7th. The roll got certified. It was started at 8:30 AM, and it lasted until 2:11 on Wednesday. Of the 679 business personal property accounts, there were 228 exemptions that got removed due to being late or no-file application.

So, we exempt a certain amount of business personal property for everyone, unless you don't file, you lose the exemption. We have an exemption appeal coming up for the Assembly acting as the BOE on July 17th. You should have your books about that by July 7th. In Engineering and Facilities, you will get a long presentation about this next week, so I won't read all the numbers, but they're there if you're interested. It was a successful event.

It shows how much, uh, stuff we received at the landfill and the parking lot. We do want to thank the Chamber of Commerce for coordinating the effort with the Yellow Bag Community Cleanup, and thank you to the Lions Club and Kodiak Native Youth Council and the City of Kodiak for your support efforts associated with the event. The Architectural Review Board met on Tuesday. They reviewed the Northstar Elementary skylight project that you just heard about, the East Elementary roof, the landfill shack platform, and the Mill Bay Beach stair replacement projects. The contractor, just as I— at the end of the workday, Cody told me that they are substantially complete.

So there is a punch list item, a list of items that they're going to go through in the next couple of days, and that project will be wrapping up. They used 20 of the not to exceed 24 containers, so it will be 4 containers cheaper than we had anticipated. Asbestos abatement is done, and you heard from Ted about the status of those buildings, so you know what's going on. At the KFRC, the touch tank is going to be open tomorrow from 10 to 2. Out at the landfill, the regional solid waste management plan RFP was opened on the 8th We had 5 submissions.

We have interviews for the top 2 firms on the 13th. Expect to see that on June 5th for assembly approval. The landfill boundary brush clearing bids are due by May 9th. Staff is reviewing the current fee schedule at the landfill to determine if updates should be made to the rates, and they'll be proposed to the assembly. And when you get that, there'll be a that cross-fund report along with what we anticipate coming in for the next year.

And we have an invitation to bid out for monitoring wells that is posted and bids are due on May 14th by 2:30. The Kodiak Middle School and Providence elevator contracts are fully executed. They met with the contractor on May 7th to discuss the upcoming site visit and project timeline. There is already talk about the tariffs and how that might affect that contract and how hard it's going to be for them to get pieces and parts in. So if that's the case, uh, you will be seeing change orders for that contract.

The community pool site visit is scheduled for May 19th to 21st. For service areas, the invitation for bids is published on the website. We had a pre-bid meeting, um, 3 different contractors came in. It was mandatory, so hopefully all 3 bid— bids are due by May 14th at 2 PM. And we also put out a request for quotes for the annual facilities parking lot sweeping.

That's been awarded to AIM Maintenance for $18,000. In information technology, uh, they are continuing to focus on infrastructure improvement, cybersecurity initiatives, and interdepartmental support efforts. They're working on the borough disaster recovery policy. They have full disk encryption rollout for all laptops for BitLocker. So if you have an assembly laptop, um, IT is asking that you leave it here tonight so that BitLocker can get installed on your laptop.

And all that is, is every time your computer shuts down, when it starts back up, uh, there's a 6-digit code that has to go in. You just have to remember 3 of the 6 numbers and the last 3 or whatever your inventory tag is that is attached to your laptop. So it took a while, but it's easy now. IT is collaborating with Engineering Facilities to support wireless networks at the KFRC. They also applied security patches to the women's base systems this week.

And they met with the clerks and a Laserfiche sales representative to discuss training implementation strategies for laser fish. And that's all that is in my report tonight. I'm happy to answer any questions. Dave. Thank you.

Kind of pertaining to the report, kind of pertaining to what I missed because I was at the other meeting, and then what I heard when I walked in, I just wanted to make sure I'm clear for next week's meeting. It looks like on April 30th we We received the ask from the school district, $12,979,550, $650,000 was what we were sent. Looking at page 30 of our budget, I'm just trying to understand what the manager's budget is funding towards that ask. The manager's budget was based on the school district's request for flat funding from last year. So until we went to the joint work session session, we didn't know that there was going to be an increase.

And so there is a weird number in there. There's like $12,900,000. And so that's a— there is a $544,000 addition in there for lawyer fees.

So— excuse me. Good evening. So you're talking about the education fund, or you're talking about the school district ask? Because those are two separate pieces. I'm asking about the ask.

Are we budgeting to fund the ask? The, the— in the budget, we have the flat funding from the prior year, but it looks like $12,900,000 because there's more to it than just flat funding. Not in the school district ask, but in the education, in the education fund. Yeah, in the education fund, there's additional money in there because the fund is in a deficit balance as of the end of last year. So the education fund's asking for more money to be in that fund due to that deficit, but that's not going to the school district.

So we're not planning— the manager's budget does not fund the ask? No, no, no, it doesn't. It currently does It's not, but it's not the final version of the manager's budget. Okay, I'm just— I mean, I've only been watching our budget for 7 years, but the budget has always reflected that district's ask. No, it hasn't.

The initial budget has. No, it hasn't. At least the last 5. Um, so when I— Okay, well then the last 5 have. When I met with the superintendent when we were forming the budget, because remember you get a preliminary budget in February and then the budget is due April 1st.

Um, that they told me of flat funding, like they— that was what I was told, and I did give them exactly what they asked for. They said flat funding. They absolutely— they didn't give it as dollar, but they— no, they said dollar. They said earlier at the joint meeting what they were asking for. That was after she had the number in the budget, but that wasn't an ask from the dist— from from the district.

Yes, she had discussions with—. That were— those were discussions. She had discussions. The manager had discussions with the superintendent of schools on there. That's where the number came from.

Flat funding for the, the same as we gave in the current year. It wasn't until the joint work session where they did flat percentage, and so that was that was— I, I mean, I knew it was coming, but, um, that is not what the budget was built on because that's not what they asked for.

Does that answer your question, Dave? I guess so. Thank you. Okay, anything else that you have on there? Okay, then let me get here.

Clerk's comments. Nova. Thank you, Mr. Mayor, members of the assembly. Um, the manager already reported on the BOE, um, for now.

In addition to that, I just want to thank the BOE members for their service. And, um, the decision letters regarding the appeals were sent out on May 7th, and the deadline for appealing to the Superior Court is June 6, 2025. Um, you received an invitation by email to the Luthic Museum's grand opening. You are invited. And it's on Thursday, May 22nd.

Please let me know if you are attending. If 4 of you are going, I need to advertise.

We also got an attorney's opinion. An assembly member emailed asking about ex parte contact, so I contacted the attorney, and the attorney's opinion is before you. It was also emailed to you. So, records update. My staff and I are collaborating with our Laserfiche vendor vendor and IT department.

I attended the training 2 weeks ago, and I found the benefits of doing forms. So we're going to give it a try and see if we could maybe streamline the process of archiving our contracts, and then we'll use forms for— and maybe make it available to other departments that could probably use forms, and potentially to external customers also. So records— the Deputy Clerk is busy with several projects, including destruction of records that have met their retention period. We're preparing for quarterly meetings with records coordinators and training new staff members with record archiving. And use of the retention schedule.

Maintenance of election equipment. Last week, a representative from our election equipment vendor visited us to upgrade our election system. They not only upgraded the version to a current version, but also performed maintenance. Since our machines were unable to automatically sort ballots last year, our— I requested our canvas to do a manual sort. So that was figured out during this visit.

We also sent one of our machines for a battery replacement. We spoke about— or the manager spoke about the BitLocker on assembly laptops, so please leave those to me tonight. Status of our EPL 3293, second floor restaurant: the licensee has asked for a hearing with the Office of Administrative Hearings, and the borough is expected to take part. A hearing officer will be appointed by OAH to set a date for the hearing. Both the borough and the city of Kodiak will have the opportunity to join in.

According to the regulations, the borough must show up to defend the protest decision. OAH will notify the borough formally when the hearing is scheduled. Agenda management training. The clerk's office conducted the training for staff on managing agendas, which included topics like action tracking, agenda statement summary, and meeting management. I also provided you the status of the legislative budget and the clerk's budget, and I also provided you one of those Jurassic Parliament articles And, uh, it says don't recognize dilatory— is that how you pronounce that word?

Time-wasting motions, it says. Dilatory. Okay. And that's all I have, and I'd be happy to answer any questions that you may have. Any questions of Nova?

Seeing none, we'll move on to assembly member comments. Jared, I'll start with you. Uh, Nothing. Let's keep going. Yeah, I agree.

Dave? No comment, sir. Steve? No comment. Larry?

No comments. Scott? No comment. Perfect. Mayor's comments?

No comment. Um, supplemental material, is there anything there? Seeing none, we will go ahead and, um, Mr. Mayor, if you're moving on to the special meeting, could I—. Well, I'm going to take a break.

You're going to take a break? Yeah. Okay, I'm just basically going to say I'm adjourning the work session at 9:09 PM. Perfect. And we'll take a 7-minute break and reconvene special meeting.

7. Anybody else want to pass?