(Courtesy of the City of Hoonah)

The City of Hoonah filed a petition to create what would be the region’s biggest borough early this month. It would include some profitable land that is currently part of the Haines Borough.

As proposed, the more than 35,000 square mile Xunaa Borough would include several geographic areas that are already part of Juneau, Sitka, and Haines boroughs.

The proposed boundaries include Excursion Inlet⁠—home to an Ocean Beauty Seafoods processing plant that generates between $150,000 and $400,000 per year in raw fish taxes for the Haines Borough. The proposed boundaries exclude the cities of Pelican, Gustavus, and Tenakee Springs, which are all in the Hoonah-Angoon census area.

Borough Manager Debra Schnabel called it a land grab.

“The whole point of creating a borough is to include communities into a regional government,” she said.

“It’s not to just to grab and that has the resources you will be able to exploit.”

Excursion Inlet is closer to the City of Hoonah than the Haines townsite. But Schnabel says the Haines Borough has helped develop infrastructure in the area. The borough will wait for a public comment period to oppose.

But Hoonah City Manager Doug Gray Jr. says that the land grab interpretation is all wrong. He says its about traditional Hoonah territory.

“So all those areas are Hoonah clan territories. My grandma’s got a native allotment at Excursion Inlet… There are people from here that are buried over there,” he said.

This is Hoonah’s third attempt to form a borough. They’re trying again now after state budget cuts because they want to generate income for the local school district. But Gray says it wouldn’t come from the raw fish tax dollars at Excursion Inlet.  They plan to make $900,000 a year from a commercial fishing and excise tax. The proposed Xunaa Borough is mostly water.

He says they don’t have plans for the raw fish tax revenue yet.

“In our operating budget, we don’t include any raw fish tax from the Ocean Beauty plant. So we could actually engage the community of Haines in a step-down process, where they would have 20 or 30 years to wean off that,” he said.

Gray says community push back on previous borough bids is the reason Pelican, Tenakee Springs, and Gustavus aren’t part of the proposal. He says those communities don’t want to pay property tax, among other concerns. But he says a lack of property tax is going to be part of Xunaa’s core charter.

The City of Hoonah is in the earliest stages of a lengthy process. Eileen Raece is a specialist with the state’s Local Boundary Commission. She’s only seen a couple of borough applications in her five years at the office.

“They don’t come across our desk very often,” she said.

“It’s a complicated process because its a complicated event⁠—forming a new borough in Alaska. You wouldn’t want it to be too simple a process or happen too quickly. We want as much public participation as possible.”

Her office is informally reviewing the application as  a courtesy before the community gathers signatures. Hoonah needs 15 percent of registered voters in the proposed borough area who voted in the most recent election to sign on. Then they submit a proposal for a technical review. Once that is approved and filed, the real process begins. It includes two separate reviews by the state and two opportunities for public comment.

Raece says the state has granted new boroughs territory from existing boroughs before.

The only example I can think of⁠—and there’s only 19 boroughs, so there isn’t a lot of precedent to think about⁠—but Northwest Arctic borough formed using territory from North Slope Borough in ’80s, however they did that with North Slope Borough’s blessing,” she said.

She says it doesn’t set a precedent, like in a legal case⁠. The commission decides each borough proposal on its own merits. They rely heavily on standards that are set by state law.

Once her office has looked over the petition, Hoonah can start gathering signatures.