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Ketchikan Gateway Borough adopts FY 2026 budget after corrections, uses reserves to close gaps
Summary
The Assembly adopted ordinance 2070 (as amended) on June 16, approving the FY 2026 borough budget while using about $3.64 million in general fund reserves and directing staff to correct errors in the printed budget book.
The Ketchikan Gateway Borough Assembly on June 16 adopted ordinance 2070 (as amended), approving the borough's FY 2026 budget and directing staff to correct errors in the published budget materials.
Assistant Borough Manager Cynna Smith told the Assembly the adopted budget proposes using $3,643,388 in general fund reserves: $1,187,391 to cover an operational deficit for the current year and $2,455,997 to finish pending capital projects. She said the FY 2026 ending general fund balance is estimated at $11,007,785 and the available fund balance after the minimum set by Resolution 29-35 is $5,231,856—about $2.4 million more than the budget book originally showed.
The corrections that Smith described include reconciling FY 2024 actuals to the June 30 audited comprehensive financial report, fixing fund-balance roll forwards for several funds (housing capital fund, airport enterprise, wastewater, South Tongass Fire, North Tongass Fire & EMS), and correcting overstated expenses in the commercial passenger vessel fund’s budget book pages. Smith said none of the corrections change the FY 2026 appropriations in ordinance 2070 as amended.
The Assembly earlier removed a proposed second software engineer position (a $177,336 reduction) during prior hearings; the amended ordinance before the Assembly tonight reflected that change. Public comment on the budget was open during the hearings and none addressed the ordinance tonight.
Assemblymember Palmer moved adoption of ordinance 2070 (as amended); Mister Bailey seconded. The roll call recorded votes as follows: Arntzen — yes; Bowling — yes; Otis — yes; Bailey — yes; Matson — yes; Ulmer — yes. The motion passed.
The Assembly directed staff to produce a revised budget book to incorporate the adopted amendments and to correct the FY 2024-to-2026 reconciliations. Smith told the Assembly she set a 30-day deadline for staff to complete the updated budget book but said finance staff expect to finish sooner; she emphasized thoroughness given past staff turnover and reconciling work that had been missed in prior drafts.
The Assistant Manager also reported the Local Education Fund (LEF) will require focused follow-up because of uncertainty at the state level: Secure Rural Schools funding and recent state vetoes affecting school funding were cited as items the borough will study in a July work session. The Assembly scheduled LEF discussion for the second meeting in July.
