City and Borough of Juneau Assembly Finance Committee Meeting - September 3, 2026
City and Borough of Juneau Assembly Finance Committee Meeting - September 3, 2026
The City and Borough of Juneau Assembly Finance Committee met on 2026-09-03. Mayor Weldon presided; Assemblymembers Wall and Atkinson participated by Zoom, and all other members were in Chambers. Assemblymember Hughes-Scandies left later in the meeting due to illness, leaving eight members for the remaining votes. The committee approved prior minutes, extensively amended and advanced the nonprofit sales tax ordinance, approved a one-year change to the Juneau Arts and Humanities Council grant MOA, advanced two HESCO barrier fund ordinances, received an FY26 sales tax update, and directed staff to prepare debt policies.
Consent Calendar
- The committee approved by unanimous consent the minutes of the May 6, May 13, May 20, June 3, and July 8, 2026 meetings.
Ordinance 2026-32 – Nonprofit Sales Tax
- Finance Director reviewed Ordinance 2026-32, which had been referred back from the full assembly. The ordinance would change sales tax treatment of nonprofit sales, services, and rentals, with exemptions such as social services.
- An amendment added a definition of social services provided as direct services to vulnerable, disadvantaged, or distressed individuals to meet basic life needs, including food assistance, housing assistance, disability support, day services, and senior or assisted-living support. Staff said the exemption would apply only to those direct services; other sales, such as janitorial or shredding services, would remain taxable. The definition was adopted without objection.
- Assemblymember Steininger proposed an exemption for nonprofits with less than $300,000 in annual sales, services, and rentals, renewable every two years with a CPI adjustment. Opponents, including Assemblymembers Wall and Hughes-Scandies, said the threshold was arbitrary and created uneven policy; supporters, including Assemblymembers Smith, Kelly, and Mayor Weldon, said it provided needed relief for small volunteer-run nonprofits. The amendment failed on a 4-5 vote.
- Assemblymember Hall proposed an exemption for intermittent fundraising events, defining them as discrete campaigns, galas, auctions, bake sales, or temporary market drives with selling windows of no more than 14 consecutive days and no more than four times per calendar year. A Steininger amendment to strike the language excluding events in a permanent retail establishment and to strike the permanent retail establishment definition passed 8-1. The Hall amendment as amended then passed 6-3.
- The committee adopted a City Attorney drafting amendment clarifying that the social services exemption applies to organizations with current IRS 501(c)(3), 501(c)(4), or 501(c)(19) exemption rulings and a manager-issued exemption certificate, and only if income from the sale is exempt from federal income tax.
- The committee adopted an amendment changing the ordinance effective date to January 1, 2027.
- Assemblymembers Wall and Hughes-Scandies objected to final referral, saying the process felt rushed and the carve-outs created inconsistent policy. Assemblymember Steininger said the work had been underway for about a year. The committee voted 7-2 to move Ordinance 2026-32 as amended to the full assembly.
JAC Grant MOA
- Finance Director explained that the Juneau Arts and Humanities Council MOA normally uses a 30% administrative overhead and 70% direct grant split. JAC requested more operational flexibility and overhead for FY27 as a one-time stabilization request. JAC Executive Director Maggie McMillan, with board president James Bibb present, said the organization had already made deep cuts and that without the change it would likely lose its education department, including placing about 13 artists in schools and busing about 1,500 students to arts field trips each year.
- Assemblymember Smith moved to direct staff to amend the FY27 JAC MOA as requested for one year only. Assemblymember Wall objected, saying the grant was intended to support the broader arts community, not just JAC.
- Assemblymember Steininger amended the motion to also direct staff to draft an appropriating ordinance adding $80,000 for major, individual artist, and catalyst grants so other nonprofit grantees could be backfilled while the JAC request moved forward. The amended motion passed 7-1.
HESCO Barrier Fund Ordinances
- Ordinance 2026-01B(D) would move $500,000 from the original HESCO capital project into a restricted lands fund for a future homeowner grant program when HESCO barriers are removed. The committee moved it to the full assembly without objection.
- Ordinance 2026-01B(E) would set aside funds in the debt service fund for repayment of the DEC State Revolving Loan Fund loan. The committee moved it to the full assembly without objection.
Sales Tax Update
- Finance Director reported FY26 sales tax came in near $67 million, compared to a $70 million budget and a revised forecast of about $61 million after the October exemptions. The city was about $3.2 million below budget but about $6 million higher than expected after accounting for exemptions.
- Six months of exemption data showed about $3.6 million in food-exemption revenue loss and just under $1 million in utility-exemption loss. Annualized estimates were about $7.3 million for food and $1.9 million for utilities, totaling about $9.2 million, about $1.8 million below the predicted $11 million.
- The Finance Director attributed the stronger sales primarily to inflation, including higher fuel prices after the conflict with Iran, plus stronger visitor spending. She also warned that inflation will push up city costs in FY28.
Debt Policies
- Finance Director presented two draft policies: a debt policy for governmental debt and a tax and security law compliance policy. She said they were designed to guide future debt decisions, meet rating-agency expectations, and address federal tax-law compliance.
- She noted one issue requiring further review: IRS rules limiting use of tax-exempt bond proceeds for private trade or business to 10%, which could implicate facilities such as Centennial Hall.
- The committee directed staff to prepare a resolution to formally adopt the two policies.
Key Outcomes
- Minutes approved by unanimous consent.
- Ordinance 2026-32 moved to the full assembly as amended, 7-2, with an effective date of January 1, 2027.
- JAC FY27 MOA direction approved as amended, 7-1, including a direction to draft an $80,000 backfill ordinance for major, individual artist, and catalyst grants.
- HESCO ordinances 2026-01B(D) and 2026-01B(E) moved to the full assembly without objection.
- Staff directed to prepare a resolution adopting the two debt policies.
- Staff agreed to conduct targeted outreach to nonprofits about Ordinance 2026-32 and the upcoming public hearing.
- The next Assembly Finance Committee meeting was scheduled for November 4, 2026, at 5:30 p.m.
Meeting Transcript
We will bring the Assembly Finance Committee to order for September Second, Twenty Twenty Six. Thank you. We have all Assembly members present in Chambers besides Assembly Members Wool and Atkinson who are available on Zoom. All right, and you have me here today, even though it's Ms. Wall's last chair of her finance committee meeting, because unfortunately she's a little under the weather. But she is on Zoom. So thank you for being here tonight, Ms. Wall. Um, approval of minutes, Mr. Kelly. I move that the finance committee approve the minutes for the May sixth, twenty twenty-six, May thirteenth, twenty twenty-six, May twentieth, twenty twenty-six, June third, twenty twenty-six, and July eighth, twenty twenty-six meetings. And ask for unanimous consent. Any objection to that? Seeing none, they are approved. I'll take that Madame Mayor. I just have her typically read the uh title. But never mind. We'll go to you. Okay. Madam Finance Director. Thank you. So this is your nonprofit sales tax ordinance twenty twenty-six thirty-two. Uh, you all have spent a lot of time talking about this in committee. It was referred to the full assembly on where it was referred back to committee. And so that's where we find ourselves today. Um, the memo in your packet, which is on page seventy-two of the packet, uh, just gives a super brief uh summary of the different meetings that uh we've chatted about this ordinance. And uh really uh before you uh is the ordinance as presented at the last assembly meeting where it was referred back to committee along with the suggested amendment by the city attorney. Um so that's on the pages following the memo. And um, this is here for you all to discuss, um, amend, move forward, um take no action, however, you want to um work through this ordinance. Um, I don't know that there's a lot that I need to add to it, as you all have talked about it a great deal. Uh thank you for that. So before we start with anything, any questions from the body. We have talked about this great bill. So um uh let's see here. Who wants to start? Maybe if you're doing a definition, we'll have you do the motion. Ms. Wall. Thank you, Madam Mayor. Um, I did have a question. I know we've talked about this, but um it did get some, you know, um good emails and the the social service exemption, I think was was one that kind of caught my eye and was thinking a little bit more about um maybe hearing from staff about how they would interpret that. Um, because I'm starting to think there are probably this is one of the many ones that has lots of potential different um interpretations, and um want to make sure we we know what we're voting on. Uh thank you, Ms. Wall for that. Um actually I have an amendment for that that just got passed, passed out. Um I hopeing someone is sending it to you and Ms. Adkisson, and hopefully that covers it. And if it doesn't, let me know. Okay, I can hold my question until we talk about that one. All right.
openpublica.com