SIGNS OF THE TIMES

Four new jewelry stores took root this summer in the new Knorr Building on Broadway. Are there too many jewelry stores in Skagway, or is this just the beginning of a new jewelry culture? See special report in top stories below. Casey Grove

DNR nixes rifle range

AMG climbing tour awarded 10-year lease on state land

By JEFF BRADY
The Alaska Dept. of Natural Resources on Aug. 9 ruled against a shared use of state land adjacent to the Klondike Highway and sided with Alaska Mountain Guides over the City of Skagway.
The city had targeted the area for a new rifle range at essentially the same time AMG proposed using it for its rock climbing tours. AMG has been operating under a temporary permit for the last three summers, but the city pressed the agency into issuing an request for proposals for the land last winter.
Earlier this year, DNR proposed a shared use of the land, but despite a wave of local comments in support of the rifle range, the agency deemed a shared use would present a potential risk for both climbers and highway travelers.
At DNR and the state Department of Transportation’s request, the city had submitted a rifle range design that incorporated baffles, backstops, fences and other measures to protect the highway corridor. However, the Risk Management Division of the state Dept. of Administration “indicated that the rifle range still presents some concern due to its close proximity to the highway and the State is not entirely protected from the associated liability and risk.”
AMG had commented that it also may have trouble getting insurance if a rifle range were nearby, and requested the city be added as a co-insurer. The city agreed, and the state was willing to accept those insurance arrangements, but in the end ruled that the state could still be liable in the event of an accident.
The state recognized Skagway’s dilemma of finding a suitable site for a new rifle range, but said it should continue to look for one on municipal land, possibly on new entitlement lands. The current range is off the Dyea Road at the trailheads to Yakutania Point and Smuggler’s Cove, and close to a growing residential area.
The city had requested a 50-year lease on the land up the highway, and AMG requested a 25-year lease. The state ruled that a more appropriate lease term would be 10 years. AMG had also proposed that its fee be $1 per user, but the state decided to increase that fee to $1.50, or 2.5 percent of the annual gross receipts, whichever is higher. This fee was based on similar uses of U.S. Forest Service land. The state also will require annual rent of approximately $7,380 for the six acres being used. AMG also now must construct a driveway – something the city was willing to shoulder under a joint use – in addition to wooden platforms for its own use, and put up a $4,200 performance bond.
When asked this week if AMG was pleased with the ruling or if it would challenge any of the new requirements, company spokesman Jason Gaffney issued this brief statement: “It has been a long process and we are ready to move forward.”
City officials, however, were uniformly miffed.
In his report to the City Council on the decision, City Manager Bob Ward accused the state of “electing to go with the ‘money in the bank’ preference over the greater public good.”
While the state sided with AMG’s contention that its operation was of economic benefit to Skagway – it employs about 25 climbing instructors, tour agents and drivers and rents two houses here – city officials contended that most of the revenue is taken out of the community. AMG’s main office is in Haines, and some employees commute from there.
Ward called it “simply cutting their own slice from Skagway’s economic pie and eating it in Haines.”
Councilmember Mike Korsmo, whose Parks and Rec. committee deemed the site as the best alternative for a rifle range – away from residences and a park – said the state ignored support from Skagway.
“Shame on them,” Korsmo said. Others at the table called the ruling “nonsense,” a “charade,” and accused the state of being “for sale to the highest bidder.”
Despite their strong objections to the decision, Mayor Tim Bourcy and Council members decided not to appeal the ruling, and instead will make sure AMG complies with the conditions mandated by the state.
A Parks and Rec. Committee meeting will be held on Tuesday, Aug. 30 to start looking for a new rifle range site.
One consolation from the city’s efforts, Ward noted, is that the city can use the rifle range design and “build it anywhere.”

More better?
Eight new jewelry stores bump total above 20 in Skagway

By CASEY GROVE and JEFF BRADY
Getting one’s hands on a little gold no longer requires a trek up Chilkoot Pass and a boat ride to Dawson, because with 23 jewelry shops – including eight new stores this summer – the journey for gold, gems and diamonds has been reduced to only a few blocks.
And 23 stores is a conservative count, because that is the total number of stores selling only jewelry. Some stores sell jewelry along with other merchandise, so the total number of those selling jewelry is actually higher.
Tourists and locals alike have questioned the large number of jewelry stores, not just in Skagway, but in all Southeast Alaska communities visited by cruise ships.
“I get it all the time,” said Kevin Ballard, store manager for Little Switzerland. “People coming in and asking, ‘Why are there so many jewelry stores?’”
“I think the root of this is basic economics and supply and demand,” said lifelong Skagwayan David Brena, whose family owns several local buildings and rents to jewelry stores. “I think it’s an indication of what the tourists want in their shopping.”
“People vote with their dollars,” Brena said.
Large retailers like Little Switzerland, Goodmark and Diamonds International, who own hundreds of stores worldwide, spend their winters doing business in cruise ship ports in Mexico and the Caribbean, among other popular tourist destinations.
“These folks are following the big white boats,” said jeweler Casey McBride, year-round Skagway resident and owner of Taiya River Jewelry since 1976. “It makes a lot of visitors think that the town is owned by the cruise ships.”
“There are definitely too many; there were too many years ago,” McBride said. “It’s creating unreasonable competition.”
“It’s got to reach a breaking point somewhere,” he added.
Nili Zaviv, general manager in Skagway for Diamonds International, disagreed.
“If you’re comparing (the number of stores in Skagway) to any other port in the world, it’s not too many, it’s just perfect,” she said.
Zaviv said that competition is always good. “It’s obvious that it’s always growth,” she said.
According to city sales tax figures, jewelry-exclusive stores in Skagway sold more than $17 million worth of merchandise in 2004, and that revenue has increased steadily for the past five years. From 2000 to 2004, jewelry store revenue grew by an average of about $2.5 million each year.
In 2004, jewelry stores generated $696,137 in sales tax for the city, said City Treasurer Cindy O’Daniel.
“The reason that Skagway is great is because people shop in Skagway,” said Diamonds International Alaska Project Manager Michael Villani from New York City. “There are a lot of people, more ships, more competitors.”
Jewelry stores not only compete for customers but they also compete with all other businesses for spaces to rent.
“As the numbers go up, the rents go up,” Brena said. “The tenants that can pay the most rent are the ones who make the most money.”
“I think the jewelers are willing to pay more rent than anyone else,” Brena said.
Although no one would say what they pay in rent, it is common knowledge in Skagway that some of the larger Broadway storefronts are in the six-figure range per year.
Local landlord Dennis Corrington said the jewelry stores, or “Caribbean operators,” as he calls them, have an advantage because they have a 12-month operation and most local merchants are only in business for six months out of the year. He blames the city for imposing too many barriers that hurt the six-month businesses more than the 12-month businesses who have more capital to use in start up and operation.
“You just don’t put a 12th grader in a football game with a sixth grader,” Corrington said.
Though Corrington rents to two jewelry stores, he said he and his family are worried about the direction Skagway is going, and predicted that other duty-free shops, selling things like liquor, electronics and perfume, would soon be moving in.
Last year, Corrington suggested the city put a cap on the number of jewelry stores, but the idea never gained support because of concerns on limiting free market enterprise. But Corrington contends the city already has numerous regulations, and because of this, he compares Skagway to a mall.
“There’s no mall anywhere where they would allow 80 percent jewelry stores,” he said. “You need a vibrant mix to attract people. Our mall is out of whack.”
“It’s sad,” Corrington added, “because this is such a great community with a lot of potential, and like any top that starts to wobble, it’s going to fall.”
Andrew Knorr grew up in Skagway and recently constructed a new building at Broadway and Fifth that ended up housing four new jewelry stores.
“I would love to have somebody else in there besides jewelry stores,” Knorr admitted.
Knorr said the rent is based on location and how much other landlords charge. The general consensus among those owning Skagway’s commercial properties is that the farther to the south a building is located, the more rent it can earn. Knorr said he tried to rent sections of his new building to art businesses, but they balked at the high rent he was asking.
“The jewelry stores jumped at it,” he said.
“Personally, I do think there’s too many. I wish there was other stuff in Skagway,” Knorr said. “I think it does take away from the shopping experience to have jewelry store after jewelry store after jewelry store.”
“Obviously there’s a difference between business decisions and personal opinion,” he added.
So with the number of jewelry stores approaching 30, could it get any higher? There are close to 50 in Ketchikan, and Skagway renters like Corrington are fielding calls from potential 2006 tenants almost on a daily basis at this time of year.
While many people in Skagway and visitors think there are too many jewelry stores, the cruise port market may allow more. The new stores appear to be surviving the competition.
“Things are okay; they are fine,” said Najma Saeed of Genoa Jewelers, manager of one of the new stores in the Knorr Building.
As good as the Caribbean?
“Almost.”

BONUS FEATURE: ‘Jewelry culture’ brings the world to Skagway - Jennifer Collins

This bulletin board at Little Dippers Day Care is just one place in town where cultures gather from around the globe. Jeff Brady

Smuggler’s Cove will remain quiet

By MOLLY McCLUSKEY
After hearing overwhelming opposition at a public hearing this week, a city committee denied a request from Alaska Power and Telephone to use Smuggler’s Cove for moving heavy equipment for its Kasidaya Creek hydroelectric project.
The cove, part of Yakatania Point Park and classified as an “area meriting special attention” (AMSA) in the Skagway Coastal Zone Management Plan, had been eyed by AP&T as an alternative to the small boat harbor for loading and unloading of equipment during the project’s construction.
The project is located about two miles from Skagway on the east side of Taiya Inlet. Equipment would have to come from Skagway or Haines. AP&T initially approached the City Council for permission to use the cove, and the request was forwarded to the Parks and Recreation Committee, which met Aug. 22.
AP&T’s Dave Vogel said using the small boat harbor “faces challenges such as weather, a busy summer season and commercial operators on a fast schedule.”
The company intended to utilize Smuggler’s Cove for 99 equipment moves with a landing craft from September 2005 through July 2007. But it was quickly pointed out that the requested land use would run counter to city code and the coastal zone plan.
The AMSA calls for Smuggler’s Cove and Yakatania Point to be managed as a park. Under the Skagway Municipal Code, Smuggler’s Cove “shall be used for low impact recreation activities with minimal facilities.”
Hikers, joggers and wildlife enthusiasts have been using the area since the early 1920s, when it was mentioned in Skagway’s “The Daily Alaskan.” Congress set aside 250 acres in 1925 as a public park. Now 87 acres, the area still serves as it was originally intended.
This was not the first time, however, that Smuggler’s Cove had been targeted for industrial development. In 1977, Westours requested the town give them a 55-year lease easement to build a pier at Smuggler’s Cove for a day boat tour operation. In return, they promised to design and develop a picnic and day use area. Additionally, the public would be allowed use of the pier when it was not being used by the company. The City Council called a meeting to discuss the issue, but the proposal was withdrawn before an election due to overwhelming opposition from the public.
Nearly 30 years later, the public once again opposed plans to allow industry into Smuggler’s Cove, even for a temporary use.
Of the concerns, the largest was over the environmental impact to the area. Councilman Mike Catsi repeatedly asked about intended modifications to the area, such as road upgrades and tree removal. AP&T’s Vern Neitzer admitted, “We would need an area large enough to turn a truck around in.”
Nearby Dyea Road resident Liz Lavoie objected. “Enough room to turn a truck around in is a considerable amount of room,” she said. “Packed gravel is required. And packed gravel turns into a parking lot. The nature of the area will be changed.”
Of equal concern was the precedent that such an action may set for other companies that may want to use the area. “How do you say yes to one plan and no to another?” Jan Wrentmore asked.
“I just don’t see why it’s necessary,” said Ken Russo, retired harbormaster. “Yes, the harbor’s busy at times, but most of the commercial operators are on a predetermined schedule.”
Not to be dismissive of the concerns facing AP&T regarding the small boat harbor, councilmembers Dave Hunz, Mike Korsmo and Catsi agreed to work with AP&T to discuss upgrades and repairs to the harbor to make it work better as a staging area for the project.

Candidate slate fills for Oct. 4 election
While the pool question will be on the minds of many Skagway voters this fall, there will be competition for all but one seat on the Oct. 4 municipal election ballot.
Eight candidates filled the open slots on the ballot before the Aug. 15 deadline, and they recently were asked why they are running.
Mayor Tim Bourcy will be challenged by David Brena for the city’s highest office.
Bourcy said “unfinished business” is his motivation for seeking a third two-year term.
“There are two priorities that I set out in my original term that I’m still working on,” Bourcy said. “Getting land out to the public and getting the clinic finished. Literally, that’s motivation.”
Land is also a priority for Brena, who ran unsuccessfully for City Council last year. Now he is ready for a turn at mayor.
“I think, primarily, my real estate and land use type expertise is something that is greatly needed in Skagway right now,” Brena said. “One of biggest issues is lack of housing in town, in general, and I would concentrate on that. I think I am unique in town in respect to real estate related issues.”
Three candidates will be running for two three-year seats on the Skagway City Council: incumbent Mike Catsi, Bert Bounds and Craig Jennison.
Catsi is seeking a second term. He said he has a lot of work left to do, and is pleased with the direction at City Hall.
“I just feel like things are going really well with the city and going in the right direction,” Catsi said, “and I’d like to be part of the team that keeps it going that way.”
Councilmember Monica Carlson elected not to run for reelection for personal reasons, and this disappointed at least one of the candidates, and was a factor in deciding whether to run.
Bounds said he would not have run against Carlson, and hoped more candidates would have stepped up, “but there was no one I could support, so I signed up.”
This will be Bounds’ fourth try at a Council seat.
Jennison, a two-term member of the Planning and Zoning Commission, is seeking his first elected seat and said he enjoys community service.
“It’s something I’ve thought about the last couple of elections,” Jennison said. “This year the time felt right for me. I’m more involved every year (on Planning and Zoning). This seemed to be the next step for serving Skagway.”
There will be an additional one-year seat left vacant by the death last spring of long-time Councilmember and Vice Mayor Jay Frey. It will be filled by a newcomer to elected public office.
Two women have filed, L.C. Cassidy, another P&Z member, and Kathy Hosford, a member of the Dyea Community Advisory Council.
Cassidy said the town has changed a lot in her 15 years here, and there are several pressing “quality of life” issues facing Skagway.
“ I love this community and I’m willing to volunteer my time and passion to push for the opportunity for everyone to live a happy and prosperous life,” Cassidy said.
Hosford, who is trying for a second straight year to win a Council seat, said she filed due to requests from numerous residents.
She issued the following introductory statement via e-mail: “I am dedicated to the future and well being of our town and its people. I would like to see the council work towards getting its constituents more informed on important issues and encourage input and participation from the people they represent. I would like to encourage council meetings to be broadcast on local public radio or posted live on the Internet to help keep our community informed and involved.”
The Skagway News’ annual candidate forum will appear in the Sept. 23 issue, as well as pro and con viewpoints on the pool advisory questions. Skagway voters will be asked initially if the city should “proceed with the design, construction and operation of a swimming pool in Skagway?”
Then they will be asked if the pool’s expected annual operating deficit of $270,000 should come from property taxes, a combination of sales and property taxes, or a one percent increase in the sales tax. (see legal notices for exact wording). – JEFF BRADY

PHOTOS OF THE WEEK

WHICH ONE IS BIGGER? – These two local fishermen landed two big kings during the inaugural Pat Moore Memorial Game Fish Derby. See coverage of the Derby in sports to find out who has bragging rights, by a mere .05 pounds! Andrew Cremata

• 2005 FLOWER SHOW: Winners list and pictures from annual show at AB Hall

• FJORDFEST: Inaugural music festival to raise money for KHNS, Buckwheat's big walk; Festival lineup features Deering & Down

SPORTS & REC. ROUNDUP - Pat Moore Memorial Game Fish Derby a huge success; Fish This! returns and asks 'Where are you from?'

HEARD ON THE WIND: Jewelry saved the town, and more!

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