Skagway assembly adopts amended FY2026 budget and advances FY25 amendment after clinic funding, insurance shortfalls

The Skagway Municipality Assembly on Nov. 20 adopted an amended fiscal year 2026 budget and advanced a related FY2025 budget amendment after discussion about rising insurance costs and mounting clinic expenses.

Assembly members approved second reading of ordinance 25-13 — the FY2026 budget — after accepting proposed amendments that the manager said reduce general-fund expenses by about 2.2% compared with the first reading. The assembly’s roll-call vote recorded six yes votes and the motion passed.

The assembly had moved ordinance 25-14 (first reading) ahead of the FY2026 vote so the table could consider how adjustments would affect next year’s numbers. City Manager Deetsch told the assembly that a recent review of property insurance for port facilities and other assets produced a premium increase that requires a $450,000 adjustment to this year’s budget. Manager Deetsch said the insurance change and a handful of other items — software, lidar-capable GIS subscription, a clinic X-ray installation and grants approved after adoption — drove the need for the amendment.

Director Al Wald of the Dahl Memorial Clinic explained the clinic’s revenue shortfall is largely structural: the clinic operates as a federally qualified health center and therefore cannot bill emergent care at the higher facility/ER rates hospitals can charge. Wald said there can be a lapse of up to 120 days for Medicaid payments to arrive and that provider costs and a single summer medication dose example (about $8,000) have widened the gap between expense and reimbursement. He said the FY25 amendment includes “just a little over $1,000,000” to get the clinic through the final months of the FY25 cycle.

Vice Mayor Potter urged the assembly to consider using CPV (capture/proposed visitor?) funds to cover part of the clinic expense; he offered a working example of transferring 25% of the CPV allocation (about $250,000) as a starting point for discussion. Potter framed that transfer as a partial remedy to emergent-care cost increases that, he said, had jumped in some months by as much as 286% over last year.

Assembly discussion focused on balancing the need to support local clinic capacity with preserving reserves and limiting reliance on sales-tax or CPV reserves. Manager Deetsch noted several other financing adjustments in the amendment, including grant revenues for a search-and-rescue vehicle and existing contract modifications for a rock-slide mitigation project.

First reading of ordinance 25-14 passed on a roll-call vote (6 yes). The FY2026 budget (ordinance 25-13), as amended on the floor, passed on second reading later in the meeting (6 yes). Both ordinance numbers and the full ordinance text are included in the municipal packet.

What happens next: the ordinance language for FY25 amendment will continue through the statutory process after first reading; the FY2026 budget is adopted subject to the adopted amendments and any ministerial tasks the manager and clerk must complete.

Votes at a glance: ordinance 25-14 (first reading) — motion by Assemblymember Henry, second by Clerk Burnham, roll-call 6 yes; ordinance 25-13 (second reading, as amended) — amendment moved by Assemblymember Waddell, second by Assemblymember Hillis, roll-call 6 yes.