The Sitka Assembly initiated its budgeting process for the fiscal year 2025, focusing on the city’s enterprise funds and considering proposed rate adjustments during its meeting on February 29. City staff have put forward suggestions for a 4% increase in water rates, a 7.5% hike for wastewater services, and a 4% rise for both solid waste and harbor fees.
In an unprecedented decision, there will be no increase in the usage rates for the city’s electric fund this year, thanks to a $2 million grant. However, some customers will see their electric bill’s flat base rate increase for the first time since 2016, aiming to more accurately reflect the higher service costs for certain areas, such as remote islands. Municipal Administrator John Leach highlighted the financial burden of maintaining services to these remote locations, emphasizing the discrepancy between the costs of repairs and the revenues generated from these customers.
Despite agreeing with most of the recommended rate increases, the assembly has debated the proposed adjustments for wastewater services. Mayor Steven Eisenbeisz advocated for an 8.25% increase, slightly above the staff’s suggestion, to address the financial instability of the wastewater fund, exacerbated by the new disinfection system installation required by federal mandates.
The budget discussions also covered the addition of two new full-time positions to support harbor maintenance and manage the new secondary filtration plant at Blue Lake. Although Assembly member Kevin Mosher acknowledged the necessity of these roles, he expressed concern over the city’s ability to fill these positions given the current vacancies in nearly 30 city jobs.
As the assembly prepares to review the general fund budget in April, Finance Director Melissa Haley anticipates presenting a deficit budget. Mayor Eisenbeisz, however, aims to achieve a $1 million surplus, emphasizing the importance of prudent financial planning and the need to reserve funds for less prosperous years.
The assembly’s approach to the fiscal year 2025 budget underscores the challenges of balancing necessary service improvements with financial sustainability, as it prepares for more detailed discussions in the upcoming budget meeting on April 4.
