
Skagway’s Broadway Street on a busy cruise ship day. (Emily Files)
The Municipality of Skagway is trying to figure out the value of its port. Every five years the borough solicits an appraisal for the tidelands, uplands and submerged property it leases to White Pass and Yukon Route Railroad.
Borough Clerk Emily Deach said that White Pass’s lease of municipal land is based on a percentage of the property value. The more that land is worth, the more the borough gets paid in rent.
“Once that appraisal is done every 5 years, the assembly looks at it and if they agree with it, they approve it. Once that appraisal is approved, the rent is adjusted,” Deach said.
White Pass’s rent is set at 6% of the appraised value of the land. Currently, the company pays $127,200 a year to lease the tidelands from the municipality.
In the last year, the borough has had its property appraised twice.
“In this case, the first appraisal, [the assembly] did not vote to approve it. The second appraisal they also have not voted to approve. So we have two unapproved appraisals,” Deach said.
First, the municipality approached Horan & Company to carry out an appraisal of the tidelands. The appraiser listed the value at $2.2 million. But according to a review by real estate firm Integra, the appraisal did not accurately assess the land’s market value.
The Integra review states that Horan & Company did not account for the value added by improvements that have been made to the land over the years.
Since then, the municipality paid Integra $25,000 to carry out its own appraisal of the tidelands. Deach said there has been no third-party review of the Integra appraisal, and it is still unapproved.
“Until the assembly or the municipality through the assembly agrees on what the fair market value is, we can’t determine the rental rate,” Deach said.
Integra’s appraisal lists the value of the municipal property at $14.7 million, substantially higher than the Horan and Co. appraisal.
The last time an appraisal of the tidelands was carried out was in 2017. The appraisal was carried out for an analysis of the port rather than an adjustment of rent. Appraiser Julie Dineen listed the value of the tidelands as a range between $11.9 million and $14.6 million.