Business

A Juneau food cooperative that formed in a bid to take over the only full service grocery store downtown is moving ahead with startup efforts, despite a commercial operator that looks poised to take over the Alaskan & Proud space.

The co-op incorporated as Capital City Market last month. Organizer Evelyn Rousso says it raised nearly $18-thousand dollars during a founding member drive. The group also applied for a grant from the Food Co-op Initiative to pay for half of a market study to look at whether a co-op would work in Juneau.

Rousso says the study will be commissioned this week, but its scope likely will be expanded to look at more than just the A&P store in the Foodland Shopping Center.

“We’ve been holding off based on the rumors about a potential operator for the Foodland space,” Rousso says. “But we do want to move forward with that, and if we don’t hear soon we’ll move forward having them look at all different possibilities whether or not there’s someone in that space.”

Whidbey Island-based Myers Group is the company interested in moving into the Foodland location. President Tyler Myers last week said he hoped to have financing in place by Monday. He did not immediately respond to an email seeking an update. Myers Group owns about half a dozen IGA stores in western Washington, including markets in downtown Seattle and Tacoma.

In an email to supporters last night, Capital City Market organizers said they’ve spoken to Myers and hope to meet with him in person soon.

Rousso says the co-op will hold its first membership meeting September 21st in order to elect a board of directors. The group should find out about the Food Co-op Initiative grant it applied for by mid-September.

The company interested in taking over the only full service grocery store in downtown Juneau says it’s close to signing a lease agreement with the owners of the Foodland Shopping Center.

Tyler Myers, president of Whidbey Island-based Myers Group, LLC, says he’s hoping to find out by Monday whether he’ll get the financing he needs to remodel the space. It’s currently occupied by the Alaskan & Proud Market, and Myers says the plan is to keep the store open during renovation.

Myers Group owns about half a dozen IGA Markets in western Washington, including stores in downtown Tacoma and Seattle.

Ketchikan-based Alaskan & Proud announced in April that its Juneau location would close in early September. The store recently cut hours. Several shelves sit empty, and a number of employees have left for other jobs.

The Foodland Shopping Center is owned by the Rosenberger family of Juneau. Their realtor John Williams has declined to comment on ongoing negotiations.

Today (Wednesday) was the first day on the job for Bartlett Regional Hospital’s new CEO Chris Harff.

She joins the city-owned hospital from Thief River Falls, Minnesota, where she was CEO of Sanford Medical Center. Harff says she spent her first day touring Bartlett, getting to know some of the staff, and asking questions.

“What are our opportunities here? How can we exploit them? What are our challenges here? Why are they challenges? How would you fix them? What would you focus on if you were me?” Harff says. “And I’m already starting to hear the same, couple two, three issues.”

She says one immediate priority will be starting an electronic medical record system as required by the national health care reform act. She says a lot of groundwork has been done on the project, but more is needed before the system can go live.

Besides that, she says her first 30 days will focus on collaboration.

“It’s been awhile without a permanent CEO, so part of it’s a learning process,” she says. “What am I like? And I’m trying to learn that about the board members and physicians so we can have optimal communication.”

Harff has a nursing degree and an MBA, both from the University of Minnesota. She also holds a law degree from William Mitchell College of Law in St. Paul, Minnesota.

Bartlett’s board of directors, which is appointed by the Juneau Assembly, named her CEO in late June.

The board decided late last year to hire its own CEO after more than two decades of an outside management company running the hospital.

John Vowell had been serving as interim CEO since February.

The Juneau Assembly is sending voters two capital project funding packages at the October 2nd municipal election.

Assembly members last night (Monday) approved the measures without making any changes.

The first is a five year extension of the city’s temporary 1-percent sales tax — known as the project tax — which Juneau voters have approved for nearly 30 years. The second is a $25 million bond proposition to pay for additional projects beyond what would be covered by sales tax alone.

Though they’ll appear on the ballot as separate propositions, the measures are designed to be considered as one. That’s because $10 million from the sales tax extension would be used to pay down debt on the bonds, avoiding the need to raise property taxes.

Public comment was decidedly in favor of the ballot measures. North Douglas resident SueAnn Randall highlighted her support for the Juneau Arts and Culture Center, which would get about a million dollars from the sales tax extension for planning and design of a new performing arts space.

“The JACC expansion proposal offers an incredible opportunity for providing the Capital City of Alaska with a performing arts venue worthy of the talent that comes to our town, as well as supporting the infrastructure of the local and creative economy,” Randall said.

Fritz Cove resident Tom Williams was the only person to speak against either measure. He blasted the bond proposition, saying the Assembly was not living within the city’s means. But he had a more measured response to the sales tax proposal, objecting only to the inclusion of money for the Sealaska Heritage Institute’s Walter Soboleff Center.

“The project may be a great project, but for the city to designate the sales tax, public money, towards a private entity, I think is not a good way to go,” Williams said.

He pointed to a recent survey of about a third of Juneau Chamber of Commerce members, where 54 percent of those who answered thought there hadn’t been enough public input.

In his public testimony, Sealaska Heritage Chief of Operations Lee Kadinger talked about the benefits of the project, including preservation of local Native culture and about 30 permanent jobs. Kadinger also dismissed the chamber survey.

“We believe it does not represent the majority view of its membership as indicated by its own report,” Kadinger said. “We would encourage the Assembly to continue its deliberative process to bring the tax initiative to a vote before Juneau residents in October.”

And that’s exactly what happened. Assemblyman Randy Wanamaker was the only member to vote against sending the measures to voters. He also made a failed bid to send the funding packages back to the Finance Committee for further review.

The Southeast Alaska Native village corporation Klukwan Inc. filed for bankruptcy this week. But it plans on remaining in business.

Klukwan is an unincorporated village with about 100 residents about 20 miles from Haines. The village corporation has around 250 shareholders.

Klukwan Inc. filed a voluntary petition for what’s called Chapter 11 bankruptcy. That allows for reorganization, meaning the debtor usually proposes a plan to keep its business alive and pay creditors over time. The court could also determine how the debts will be settled.

Klukwan Inc. manager Ralph Strong said the filing stems from an approximately $7 million dollar debt with Travelers Insurance Company. Strong said Travelers was the bonding company for South Coast Construction in Ketchikan, a company owned by the corporation that closed in 2002.

Strong said the two companies were never able to come to agreement on how to settle the outstanding debt. But the main point of concern for Klukwan is that Travelers is trying to put a lien on the distribution it receives from its regional Native corporation, Sealaska. That, according to Strong, is not allowed under the Alaska Native Claims Settlement act.

So Klukwan filed for Chapter 11 to protect itself, he said.

Strong said the federal bankruptcy court will make a determination whether such a lien is allowable for collection against a Native corporation. He said that decision could impact every corporation formed under the Alaska Native Claims Settlement Act.

The bankruptcy filing lists all of Klukwan’s creditors. In addition to Travelers Insurance, they include the IRS, Sterling Savings Banks, the corporation’s own general income trust and Rosemarie Hotch. Hotch is a shareholder and board member who filed suit against the corporation last year for the way its trusts were managed and used.  An undisclosed settlement was reached on that case late last year.

Shareholders in 2011 approved a $12.6 million payout from the company’s general income trust. But Strong said neither the Hotch settlement nor the payout caused the bankruptcy filing.

The corporation sent a letter to shareholders this week notifying them of the bankruptcy filing.

Strong said the outcome in bankruptcy court could be good or bad for shareholders. But the situation, he said, quote, “can’t get any worse.”

Juneau’s business community has serious reservations about a proposal to put two capital improvement project funding packages on this fall’s municipal election ballot, according to a survey of Chamber of Commerce members.

The Juneau Assembly will hold a public hearing on the proposed ballot propositions on Monday. One would extend the city’s temporary 1-percent sales tax for five years to pay for a $34.5-million project list. The other is a $24.9-million bond proposition to pay for a list of additional projects. The Assembly has proposed using $10-million from the sales tax extension to pay down debt on the bonds, avoiding the need to raise property taxes.

The chamber received 116 responses to its online survey — about a third of the group’s membership. Nearly 54 percent said there wasn’t enough public input on the proposals. And 76 percent disagreed with using sales tax and bond revenue to fund deferred maintenance to city buildings — a common practice for years.

Denny DeWitt sits on the Chamber’s government affairs committee and says he’ll be happy to vote no on the measures if they appear on the ballot as is.

“We’ve got operating budget problems at the city, which means that we’re going to have difficulty funding what we’re doing,” DeWitt says. “We’re concerned about state revenues being reduced. And it seems to me this is a time to be very, very cautious about moving forward with adding things to our property tax base and to the sales tax. We can’t afford what we’ve got now; one’s got to wonder how we’re going to afford it in the future.”

About half the Chamber members surveyed said the Assembly should delay the issue until next year, when the sales tax is due to expire. But in a letter to the Juneau Assembly today (Thursday), Chamber CEO Cathie Roemmich says postponing it may be “prudent.”

Assembly Finance Committee Chair Karen Crane — one three members to answer questions about the measures at today’s chamber luncheon — says the public has had plenty of time to comment on the lists, and she sees no need for delay.

“This list was put together by nine duly elected members,” Crane says. “If we wait we’ll still be looking at a list put together by nine duly elected members, three of whom won’t know as much, because some of us have spent just months and months looking at these projects.”

Assembly members are likely to decide Monday whether to send the measures to voters, though they could be held for an additional public hearing on August 27th.