Max Jewell and Cory Belisle watch as senior Thomas Knorr carries teacher intern Tomoko Hashimoto across a stream that crossed the Chilkoot Trail during spring runoff. See Ardyce Czuchna-Curl's story on the junior and senior classes' Chilkoot hike in features below. Photo by Kevin Wang

Jury awards Lee half of damages

Both sides claim 'win'

After a three-day trial, a Juneau jury awarded local tour operator David Lee half of what he sought in damages from the City of Skagway for lost business during enforcement of the now-defunct “10-foot rule” early in the summer of 2001.
Lee was awarded 50 percent of his request, or $11,574, when the jury emerged from deliberations on the afternoon of May 12.
Both sides came away pleased with the result.
“It was a victory,” Lee said outside his Southeast Tours office last week. “It proved that the city had violated our constitutional rights. It’s a victory for the Constitution and the Bill of Rights.”
The award was half of the $23,148 he sought in an initial suit for lost profit during the months of May, June and early July 2001. The ordinance was passed in January of that year, and the city argued that Lee had ample time to adjust his business practices.
The city’s initial attempt to curtail hawking of tours from doorways was the so-called “10-foot rule” which prohibited any solicitation from within 10 feet of a city street or sidewalk. It was quickly challenged by Lee and two other tour companies, Frontier Excursions and Klondike Tours, and was implemented until an injunction halted enforcement on July 7. Over a year later, Judge Larry Weeks ruled that the law was unconstitutional by restricting more than commercial speech. Lee then sought damages for lost profits.
“I’m happy,” Lee said. “I’d obviously be more happy if it was more money.”
The Skagway City Council met for about a half hour in executive session May 20 to discuss the outcome of the case, and emerged without taking further action.
City Manager Bob Ward characterized the jury’s decision as a “glass half empty, glass half full” verdict.
“We still consider it a win that they didn’t get what they asked for,” Ward said.
The city manager added, “At this point there are no plans to appeal.”
Attorneys for the tour companies are filing post-trial motions to recover attorney fees, and the city could challenge those.
Jeanne Gonzalez, co-owner of Frontier, said she hopes to get about $5,000 in attorney fees back from her early involvement in the case, and Klondike’s Greg Clem said he hopes to get back about $1,200.
Ward said this week that the city’s cost for its own attorney fees for the case was “fairly significant” but had not received the final bill and breakdown.
The Lee damages case was the first of two between the city and tour operators scheduled for trial this summer. After the 10-foot-rule was thrown out in 2002, the city in May 2003 passed a new ordinance restricting commercial sales and off-premises canvassing to buildings and outside areas at least 200 square feet in size, upon approval by the city manager.
Lee calls it the “200 foot rule.” The ordinance also prohibits selling on the sidewalk and pedestrian interference; littering with handbills; creating verbal or physical distress; misrepresentation of price, quality or nature of product; and use of boisterous, loud or profane language.
The 2003 law is still being enforced and has been challenged by Lee and Skaguay Tour Co. owner Terry Robertson, on similar grounds as the previous case – that it violates free speech rights.
A jury trial has been scheduled for Skagway on Aug. 2 before Sitka Judge Larry Zervos.
Four motions for summary judgment have been filed in the case and were argued before the judge on April 26. He is expected to make a ruling on those sometime in June, Lee said.

State rejects City, Alaska Mountain Guides requests for land use by highway

Rifle range on hold, rock climbing proceeds under termporary permit

The city must rethink plans for a new rifle range off the Klondike Highway following the state’s denial to lease out the proposed site without more detailed plans for the project.
Alaska Mountain Guides and Climbing School (AMG) currently operates a rock climbing facility on land adjacent to the proposed range under a temporary land use permit. AMG was also denied a lease that would allow them to further develop the land.
The temporary denials came May 17 in letters addressed to the city and AMG from Brady Scott, a specialist with the Department of Natural Resources.
Both the city and AMG have the opportunity to submit more detailed development plans to the state by Sept. 15 if they wish to continue lease requests. The state letters said the two facilities are “potentially incompatible.”
Jason Gaffney, manager of AMG’s operations in Skagway, said his company will proceed with its lease request. AMG is operating on the land under a temporary permit for its second summer, and has already constructed a shed and a deck for its climbing facility there. The site is located west of the highway at about Mile 6.5.
“We’ve already sent a letter to the Department of Natural Resources expressing our intent to continue with the lease application. We definitely hope to hold onto the site,” Gaffney said.
The city council is not as definite about plans for the new rifle range. Council members will decide whether to proceed with the city’s lease request at their next meeting on June 3.
The current rifle range off Dyea Road poses a safety hazard to the road corridor and nearby Yakutania Point Park, and will close once a new site has been developed. “It’s going to be less attractive with every year that passes to maintain that site,” said council member Dan Henry.
But in order to proceed with the lease request on the proposed site, the city must submit to the Department of Natural Resources a long list of further information.
The state’s letter to the city requested further details and dimensions concerning the proposed range’s design, information about how environmental risks will be managed, and a safety analysis endorsed by a rifle range design expert or safety engineer.
“I think we’re going to have to hire professional help to go where they want us to go,” said council member Mike Korsmo.
Mayor Tim Bourcy said it might be in the city’s best interest to proceed with the lease application. “I think it’s appropriate to look at the risk management issues as part of the process,” he said.
But Korsmo said the state is “hoping we’ll go away.” He said he has already started looking at other possible sites for the new rifle range.
If the city decides to pursue its lease request, and both leases are granted, it is unclear how both facilities could operate on adjacent land. The state’s letters said management criteria could be imposed to make both uses compatible.
These criteria could establish a joint-use agreement between the city and AMG with provisions for mediation or arbitration, or a limitation of times of operation that would favor the rock climbing facility during tourism season and the rifle range during the off-season.
AMG’s Gaffney said a shared-use setup wouldn’t be favorable to either party. “I wouldn’t say it’s impossible, but I see a lot of challenges that could arise from shared use,” he said.
“I hope that we can come to a solution, but that’s really in the hands of the Department of Natural Resources,” he said.

High gas prices affect entire community
The price of a gallon of regular unleaded gasoline at Services Unlimited, Skagway’s only gas station, has risen 54 cents since February 22, from $2.16 to $2.70 last weekend, and probably won’t fall any time soon.
This dramatic price increase echoes similar increases throughout the nation, and has had dramatic effects on businesses and consumers in the community.
“It’s been going up on average about 10 cents a week, and I don’t really see it going down over the summer at all,” said Services Unlimited’s manager Kareen Lihou. “We’re going to be parking our big gas-hogging vehicles and doing a lot more walking,” she said.
Customer complaints about high prices are on the rise, but Services Unlimited has not lost business, Lihou said. The station currently sells around 1,500 gallons of gas every day.
Services Unlimited’s product is supplied by Petro Marine Services, a Seward-based company that ships gasoline into Skagway and six other towns throughout Southeast and Southcentral Alaska. Bob Cox, senior vice president of operations for Petro Marine Services, said the price hikes are based on increases from the oil refineries where his company buys gasoline wholesale.
“Crude oil prices are at the root of what’s going on, and they’ve skyrocketed in the past five months. It’s good news for Alaska because we have oil, but bad news for the consumers that have to pay for it,” he said.
Cox explained the high crude oil prices in terms of simple economics. “The oil-producing countries have decided to curtail production, while demand has jumped dramatically,” he said. The increased demand is partially a result of China’s rapidly expanding economy, which needs increasing amounts of oil to fuel growth, Cox said.
Cox also blamed continuing strife in the Middle East for the high prices. “The markets hate uncertainty. As long as there is political uncertainty in the Middle East, the value of oil will be higher because the supply could be interrupted,” he said.
Meanwhile, high gas prices are choking local businesses. “The ones that are hurting most are the tour operators, because they already have their brochures printed up and their prices set,” said Lihou.
Greg Clem, owner of Klondike Tours, said his expenses have increased between 30 and 40 percent in the last year. “We haven’t been able to raise our prices enough to cover the increased gas expenses,” Clem said, though he raised the price of a single tour $3 two years ago and $3 this year.
The future doesn’t look bright. “We’re either going to have to keep increasing prices, or find some way to reduce our tours. We’ve got to be lean and mean,” Clem said.
Stuart Brown, owner of Skagway Municipal Area Rapid Transit (SMART), has faced similar challenges. The transit company uses about 8,000 gallons of gas a year, and Brown said increased prices have cut into his payroll. “There are so many businesses here that use gas and diesel vehicles, and it hurts all of us,” he said.
Brown has investigated transit options that use alternative energy sources such as electric power, but said they’re still too expensive to make feasible. “Unfortunately, we don’t really have any other alternatives right now,” he said.
Gasoline prices aren’t the only prices that have gone up. Tracy Snyder, co-owner of Fossil Fuels, the company that provides much of Skagway with home heating oil, said the price of her product is the highest it has ever been, at $2.08 per gallon. Fossil Fuels is also supplied by Petro Marine Services.
“People need the fuel, so they’re obviously going to pay the price, but as long as OPEC isn’t going to process any more fuel, they’ve kind of got us all,” said Snyder.
Cox said gas prices almost certainly won’t fall with summer approaching. “Memorial Day is usually the kickoff for the summer driving season, so it’s hard for me to imagine that things are going to get any better in the next few months,” he said.
But Cox said increases over the summer shouldn’t be as drastic as those of the past few months. “We’ll probably see a slight increase for gas, while diesel seems to have leveled off, but all of that could change with tomorrow’s news,” he said.

Local diver Mike Korsmo (left) talks to other members of the salvage crew after the helicopter was lifted onto the barge. It then was taken to Juneau. Photo by Ken Graham

Feds investigate engine failure; downed chopper recovered

The Federal Aviation Administration and the National Transportation Safety Board are investigating the cause of the engine trouble that forced a TEMSCO helicopter to make an emergency landing on the shoreline of Taiya Inlet on May 11.
The submerged helicopter was recovered May 14 by a dive team, placed on a barge, and shipped to TEMSCO’s Juneau headquarters over the weekend, said Jim Vuille, supervisor of the FAA’s Juneau Flight Standards District Office.
The engine and other components were sent to Turbomeca, the manufacturer, for investigation. The company will attempt to determine what caused the helcopter’s loss of power, and report back to the FAA, said Viulle. “We won’t really know anything until we get those reports,” he said.
TEMSCO vice president of tours and marketing Tim McDonnell said the helicopter, valued at over $1 million, probably won’t see service again. “Since it spent all that time under salt water, it’s likely that it won’t be salvageable,” he said.
McDonnell said the company will have to shuffle some of its fleet of helicopters around to make up for the loss. “We’re going to have to move some helicopters around in the state to make sure that Skagway isn’t short,” he said. The company currently operates seven helicopters from its Skagway branch.
The NTSB has already issued a preliminary report on the incident. It states that the helicopter, an Aerospatiale AS-350B2, experienced a loss of engine power while returning to Skagway from a sightseeing tour of Meade Glacier about 2:10 p.m. May 11.
At approximately 2,200 feet the pilot noticed several warning lights go off and selected an emergency landing site near the shore of the inlet about 6 miles south of Skagway. When the pilot attempted to activate the helicopter’s emergency floats, they did not deploy, the report states.
The helicopter’s four passengers, all from the Diamond Princess cruise ship, exited the helicopter into waist-deep water where the pilot assisted them onto the rocks. The passengers were all wearing personal flotation devices, but none were activated or needed.
No injuries were experienced, and the passengers were picked up by a rescue boat from the passing Fairweather Express around 4 p.m. All passengers departed from Skagway on the Diamond Princess as scheduled.

CITY DIGEST: Bourcy plans to veto using more sales tax for general fund
After the City Council on May 20 passed second reading of an ordinance that would extend the use of sales tax proceeds by an additional mill, Mayor Tim Bourcy said he was considering a veto.
The measure passed 4-2, with members Mike Catsi, Mike Korsmo, Monica Carlson, and Dan Henry in favor, and Jay Frey and Dave Hunz voting against it.
Council by code may use the equivalent of 1.5 mills from sales tax funds to buy down the mill rate, but is allowed to use an additional mill with a vote prior to the passing of the budget.
With the State Legislature trying to get a handle on its budget, Bourcy said it was time for Skagway to “get its house in order.”
The mayor said he would have his explanation in writing at the next meeting on June 3, and the council can decide whether to override.
A veto would be a “strain on the budget” he noted. Without the Council making any cuts to the proposed $3.61 million budget, the mill rate would rise from an anticipated 9.65 to 10.65 in Service Area 1. Property taxes are already due to rise - the current downtown mill rate is 7.78.
Various council committees have been holding budget work sessions the past two weeks. They will meet as a committee of the whole on June 1, and second reading of the budget is scheduled for the June 3 meeting.

SCHOOL REPORT: School notified of huge foreign language grant
“Si Habla Espanol?”
Those words will be coming from the mouths of elementary students soon, not just visiting cruise passengers and crew members.
Skagway City School Superintendent Michael Dickens announced last week that the district will be receiving a federal Foreign Language Acquisition Grant Program (FLAP) grant. At $175,000 a year for the next three years, Dickens said it will be largest grant ever awarded the district.
Dickens said he applied for the grant last year but did not receive it, and got it this year on the second try. He was notified by phone that Skagway would be one of 250 districts nationwide (about 1,500 applied) that will be awarded the grant. Although official notification will come soon in the mail, he could not wait to announce it at the board meeting and graduation ceremonies last week.
A big reason Skagway received the grant was the lack of, or inconsistency with, its foreign language offerings, Dickens said. Due to budget constraints, the district has offered languages in the past only if a high school teacher in a core area could teach it on the side. In recent years a math teacher taught Spanish, a music teacher taught German, and a visiting Japanese exchange teacher taught her language.
“Part of the grant emphasis was that our kids need this,” Dickens said. “But we need to make it consistent.”
The new program will enable the district to hire a K-8 Spanish instructor (outside of the current budget), and high school Spanish will be taught by another instructor (see below) with aid from state of the art video conferencing technology. The district will install a system in a language lab that drops from the ceiling, and a team from Dartmouth College will come to Skagway to train staff on how to use it. In addition to language courses, the new technology can be used in other areas.
“The world is available to us,” Dickens said.
Finding a way to offer a consistent foreign language program starting in the lower grades was one of the top priorities that came out of last fall’s forum with community members, and board members were ecstatic.
“Congratulations on the grant,” Board President Chris Ellis said. “This is absolutely wonderful. Thank you.”


BRIGHT LIGHT RETIRES – Superintendent Michael Dickens hugs teacher’s aide Linda Calver after presenting her with a stained glass lamp for her 34 years of service to the school district. See more pictures from Graduation Night 2004 in features. Photos by Jeff Brady

• HEARD ON THE WIND: Soapy and girls at it again

• SPORTS & REC.: Little League, softball seasons underway; new fish filet regs in effect

• PHOTO PAGE: Graduation night and SHS awards

• FEATURE: Climbing the Chilkoot Trail to graduation

• ARTS BEAT: STC promotes tribal unity; Martin's movie magic; Library presents travel log slide shows

• EDITORIAL: Police chief candidates need public viewing

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