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City Council Faces $1M Surplus, Refutes Allegations of ‘Fraudulent’ Election

The Nome City Council

The City of Nome is set to realize a budget surplus of more than a million dollars.

The extra income is the result of a preliminary settling of accounts comparing what was budgeted versus what was spent. The city council heard the good news at Monday night’s meeting, but not before addressing claims the city was facilitating an alleged “fraudulent election” this coming Tuesday.

The assertions came in letters delivered to the city council and a letter to the editor published in the Nome Nugget newspaper last week. At the heart of the allegations is the election of new board members for the Norton Sound Economic Development Corporation.

NSEDC is one of six Community Development Quota groups established in 1992 by the North Pacific Fishery Management Council to represent more than 60 western Alaska communities. Authorized under the 1976 Magnuson–Stevens Act, the CDQs receive an allocation of each year’s Bering Sea and Aleutian Islands quotas for groundfish, halibut, and crab. As the CDQ fishery for the Norton Sound and Bering Strait region, NSEDC is a private 501(c)4 non-profit corporation representing 15 communities, from St. Michael to Diomede. NSEDC’s revenues are based off its fishing in the Bering Sea and Aleutian chain.

NSEDC holds its board elections concurrently with local voting, and charges of “deception and fraud” presented to the council are rooted in claims the City of Nome failed to share with voters NSEDC’s financial information, specifically the earnings from the CDQ’s for-profit subsidiaries like Siu Alaska. The letters go on to allege the city also incorrectly advertised NSEDC’s election and related filing deadlines. Candidates were finalized last week.

City manager Tom Moran said he reviewed the allegations with the city attorney and was confident in dismissing them.

“We simply distribute ballots and let the machine count the votes for NSEDC, and then NSEDC declares its own winner,” Moran explained to the council.

“NSEDC also confirms its own candidacy period, [and] it confirms its own candidates. The City of Nome has nothing to do with that; literally the only thing we do is distribute ballots and let the machine count them.”

Moran said the allegations focused on requests for NSEDC’s financial information. “This was not a public records request,” Moran reiterated, adding that he and city staff “were spending countless hours and public funds” on the matter. “The election is on Oct. 6, and we are most certainly not holding a fraudulent election for anyone, the City of Nome or NSEDC.”

The issue apparently settled to the council’s satisfaction, they moved on to other business; namely, a rapid first-look at the city’s budgets for the past year that will see more than $1 million extra coming to municipal coffers.

A memo from city finance director Julie Liew states the city spent $316,000 more than it had planned in the fiscal year that ended in July, but also brought in more than $1.3 million in extra revenue. The additional income is mostly from increased fees for services like the city landfill, robust equipment rentals, and roughly unexpected $1.2 million from the public employees’ retirement system, or PERS.

The council will meet to review the newfound million-dollar surplus—and canvass the Oct. 6 election—at a noon meeting the Thursday after the polls close.

The good news was somewhat scuttled by a big “ask” from the Port Commission: a request for $53,000 to demolish and dispose of a city-owned tug boat. The reason for the high cost? Lead paint, asbestos, and “five to six inches of oily sludge” inside. Council member Stan Andersen echoed the sentiments of many on the council, saying it was just too much to spend to destroy a boat.

“I plan on voting against this, ’cause it seems like a awful lot of money,” he said during the council meeting, with members of Nome’s port commission present. “My suggestion would be, take it out to the monofill after it freezes, so the sludge and everything won’t fall out the hole that’s in the hull. And maybe we can scrap it. To me, it’d be a lot cheaper to move it out there to get it off and out the way, and then decide.”

In the end, the resolution was sunk, and the decision of what to do with the contaminated tug will float back to the Port Commission.

Two more quick resolutions were passed—naming new city holidays like “Extra Mile Day” on Nov. 1 and declaring “Childhood Cancer Awareness Week” during the week of Oct. 18-24—before the council finished their meeting with a reflection on Shell Oil’s move this week to abandon oil exploration in the Chukchi Sea.

Mayor Denise Michels, who joined the meeting by phone, said the city fielded multiple calls in the wake of the decision asking what Shell’s move means for Nome, and the proposed plans for a deep draft port from the U.S. Army Corps of Engineers.

“It means it’s more important,” Michels said at the meeting’s close, “because now we don’t have other assets or other entities out there. And so we’re going to still push for that, and we’re going to hold them to what they have said in their last report for an Arctic deep draft port in Alaska.”