Rural Alaska

Dillingham renews effort to annex Nushagak fishing district

The city of Dillingham is moving forward with its renewed effort to annex the Nushagak commercial fishing district for the purpose of imposing a 2.5 percent raw fish tax. Last Wednesday night, a required meeting to hear from the public was held.

By a 2-to-1 margin, those who spoke voiced opposition to the annexation and the tax, which was collected in 2012 and 2013. The previous annexation, adopted by a contentious vote in the spring of 2012, was struck down last March by Superior Court Judge Patricia Douglass.

"The idea that the city can tax this public resource is just wrong," said Diane Wetter, who said she was born, raised and fishes at Ekuk, which will be included in the annexation.

Speaking on behalf of the Bristol Bay Economic Development Corporation which opposes the annexation, president and CEO Norm Van Vactor said BBEDC questions the fairness of taxing the Nushagak district fishermen, fleet and industry for the exclusive benefit of the city of Dillingham.

"What conversations, if any, have taken place with the other communities? What tax-sharing schemes, if any, have been proposed?" he asked.

Van Vactor's arguments, that all members of the watershed should be included either in adopting the process or in sharing the revenues, were commonly raised by others Wednesday night.

"This process," he continued, "needs to be inclusive. Instead it seems exclusive."


Several, even some in support of the annexation, expanded on those arguments, saying the city should be moving toward the formation of a borough instead of simply annexing the fishing waters. Some also questioned whether enough time was being offered for public comment, as the adoption will be decided by a vote of the city council this time, and not of the Dillingham voting public.

"I call into question the seriousness of this council's intent when it offers citizens just three minutes to testify on a document this thick," said Robert Heyano, pointing to the hefty petition in printed form. Heyano has long been critical of the annexation and led the legal efforts that were successful in overturning it earlier this year.

Ferdinand Sharp from Manokotak, who setnets in the Igushik section of the Nushagak district, called into the meeting by phone.

"I do not receive any services from Dillingham, not water, or sewer, or harbor use, and that's why I'm opposed." Sharp told the city that there had been no response from Dillingham after the tender vessel Lone Star sank in the Igushik River in 2013. The oil spill from the vessel shut down the Igushik fishery and the section setnetters were left uncompensated for their lost season.

Moses Koyukuk, speaking on behalf of the Manokotak City Council, recommended Dillingham drop the Igushik Section from its annexation plan, and develop a revenue sharing plan with the other communities. The Bristol Bay Area Health Corporation, Southwest Region School District, and City of Aleknagik, also offered formal opposition to the annexation plan at the meeting.

Others, however, came to the meeting to show support, even as they admitted the tax could hurt their bottom line.

"I don't like taxes, but I am in favor of this annexation," longtime commercial fisherman Carolyn Smith of Aleknagik told the council. "I like what taxes can do for our area, and I hope this one can remove some of the burden on other taxes collected."

Other commercial fishermen who stood in support Wednesday included Mike Davis, Tom Tilden, and Frank Woods.

"I commercially fish in every district, and the number one reason I am in favor of the annexation is that I pay taxes everywhere else but here," Woods said. "The infrastructure in Dillingham that supports the fishing industry lacks because of the lack of the fish tax."

The draft version of the 193-page petition to annex the Nushagak commercial fishing district into the city of Dillingham was adopted by the city council earlier this summer. Several council members said they would take the feedback heard Wednesday and attempt to incorporate revisions before holding a vote to adopt a final version.

If the council adopts and submits the petition to the Local Boundary Commission, "it will be out of the city's hands at that point," an attorney for the city said. It could take another six to 12 months for the Local Boundary Commission to review the petition and hold its own vote, unless the city asks for an "expedited process," which it will likely do.

The petition, if adopted by the Local Boundary Commission, will then be submitted to the Alaska Legislature within the first 10 days of session, either in January 2015 or 2016. The Legislature must veto the petition within 45 days, or it will automatically be adopted.

At Wednesday's meeting, a consultant for the city pointed out that the Nushagak district is currently the only commercial fishing district in Bristol Bay without a local fish tax. In fiscal year 2013, Dillingham collected $849,000 from the 2.5 percent tax. During the same period, she said, the Lake and Peninsula Borough collected $3.2 million, the Bristol Bay Borough collected $1.8 million, Egegik collected $1.1 million, and Pilot Point collected $690,000 from their respective raw fish taxes.

Three Dillingham city officials traveled to Manokotak on Friday for an open house meeting. A meeting is also planned in New Stuyahok, though the date and time has yet to be determined. The public comment period closed Sept. 30.

This story first appeared in The Bristol Bay Times/Dutch Harbor Fisherman and is republished here with permission.