Plunging fish tax payments raise concerns for coming years, Southeast officials say

Boats in Wrangell’s shipyard, January 2021. (Sage Smiley/KSTK)

Wrangell will receive considerably less in its shared fish tax payments this year than the city expected, city manager Lisa Von Bargen explained at an assembly meeting on Tuesday.

“That speaks to the abysmal situation related to the fishing issues in our region,” Von Bargen said.

The payment she referred to is a fisheries business tax collected outside of municipal boundaries. The state disperses the tax money to communities in the region. Wrangell planned to receive $10,000 dollars this year from the shared fish tax. In reality, the city will receive just over $1,600.

Municipalities also receive another fisheries business tax for fishing business within municipal boundaries. Wrangell’s payment from that tax is lower than expected as well: about $203,000 for the last fiscal year.

Von Bargen says that what’s almost more concerning is the fact that the $1,600 payment is based on 2019’s fishing season. And as many fishermen and industry workers in the area know, 2020’s Southeast fishing season was much worse than 2019’s.

Because of their larger populations, Sitka, Petersburg and Wrangell receive the biggest chunk of the shared fisheries tax in central Southeast.

The payments through the shared fisheries business tax program have been dropping for years. In 2015, for example: Sitka, Petersburg, Wrangell and Kake all received over $10,000 dollars from the program. Sitka’s payment that year was over $40,000. This year, Sitka will receive just $4,000.

Petersburg borough manager Steve Giesbrecht says his borough didn’t overestimate this year’s payment quite as much as Wrangell. But he agrees that seeing the financial effects of a downturn in Southeast fishing is worrisome.

“It has just been bad,” Giesbrecht said, referring to the dwindling salmon fishing returns in the area. “I mean, I’ve got a couple fishermen on our assembly, and our finance director is involved in the industry. And they’ve all been warning — have been talking this up for the last couple of years. And then last year [2020] was so bad. I’m not looking forward to looking at [finances] when we start getting into our budget for next year.”

Both Wrangell and Petersburg’s managers say that the shared, out-of-municipal-boundaries fish tax doesn’t represent a massive piece of the budget. But they say it’s an indicator of plummeting fish revenue at a time when the same communities are hurting with the effects of the pandemic and a lackluster tourism season last year.

As of Friday, the state’s reporting site shows that payments for 2020’s shared fish business tax haven’t been sent yet to Alaska fishing communities.

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