Users of Nome’s port could see their rates rise by 10 percent this season. That’s if the 2016 Port Tariff is approved at tonight’s City Council meeting.
The rate hike is part of the Port’s effort to set money aside for emergency repairs and deferred maintenance.
“You have to be able to plan for the worst, and [when] operating at a loss, you can’t do that,” explained Port Director Joy Baker.
Baker has been working with the Port Commission since January to set the tariff.
Despite her effort, the reasoning behind the rate hike hasn’t been well understood. The tariff was up for a second and final reading at the last City Council meeting, but high turnout from a frustrated public convinced the council to table it until tonight.
“A tariff increase is not designed to balance our budget, nor will it,” City Manager Tom Moran clarified at the last City Council Meeting. “It is designed to go into a rainy day fund for the deferred maintenance of our facilities. That is a very important point that I cannot stress highly enough.”
Despite the clarification, the message still wasn’t clearly received. At the last City Council meeting, local commercial fisherman Andy Bachman said he wasn’t expecting another rate hike.
“I’ve seen rates continue to go up, and I’ve seen the dock just swamped with more vessels, which I would expect would cause rates to drop,” Bachman said.
The port had a rate study done in 2013 to determine whether rates need to be adjusted at all. Based on the revenue the port was bringing in compared to its operational costs, the study found rates needed to be raised by 50 percent.
Rather than instituting a one-time hike, Baker explained, the Port Commission settled on incremental increases.
“I know how tight things are for folks in town. I know how difficult it is across the entire state and in the country for folks having to tighten their belts and deal with the economic issues going on.”
Baker said the 10 percent rate hike would help cover basic expenses.
“We’re not raising rates to build some big Taj Mahal or to have some pie in the sky or to even have a big fat bank account,” Baker explained. “We’re raising the rates to meet operational costs.”
The City Council will vote on the 2016 Port Tariff and its 10 percent rate hike at Monday night’s meeting at 7pm.
