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2013-02-28 Work Session • Kodiak Island Borough Assembly Work Session Thursday, February 28, 2013, 7:30 p.m., Borough Conference Room Work Sessions are informal meetings of the Assembly where Assembly members review the upcoming regular meeting agenda packet and seek or receive information from staff. Although additional items not listed on the work session agenda are discussed when introduced by the Mayor, Assembly, or staff, no formal action is taken at work sessions and items that require formal Assembly action are placed on regular Assembly meeting agenda. Citizen's comments at work sessions are NOT considered part of the official record. Citizen's comments intended for the "official record" should be made at a regular Assembly meeting. CITIZENS' COMMENTS (Limited to Three Minutes per Speaker) ITEMS FOR DISCUSSION 1. Sun'aq Tribe of Kodiak Update 2. Alutiiq Museum Funding Request 3. Discover Kodiak (KICVB) Budget Review 4. Kodiak Island Borough Assessor's Update PACKET REVIEW Identifying Federal Program Priorities for PUBLIC HEARING Federal Fiscal Year 2014. Ordinance No. FY2013 -09 Amending Kodiak Resolution No. FY2013 -27 Expressing Island Borough Code of Ordinances Title 15 Support for Renaming the State Airport in Buildings and Construction Chapter 15.10 Kodiak After Benny Benson in Observance of Building Codes and Chapter 15.30 Fire Code His Centenary. to Standardize the Kodiak Island Borough and ORDINANCES FOR INTRODUCTION — the City of Kodiak Building Codes. None. UNFINISHED BUSINESS OTHER ITEMS Ordinance No. FY2013 -13 Rezoning a Funding Request from the Kodiak Maritime Portion of Kodiak Island Borough Landfill Museum. Tract, Per Plat 96 -31, From C- Conservation *Declaring a Seat on the Parks and Zoning District To I- Industrial Zoning District Recreation Committee Vacant (Sandra West). (Case 13 -012). *Confirmation of the Assembly NEW BUSINESS Appointment to the Womens Bay Service CONTRACTS — None. Area Board (Scott Griffin). RESOLUTIONS *Confirmation of the Mayoral Appointment Resolution No. FY2013 -25 Designating the to the Planning and Zoning Commission Individual Who Will Serve as the (Frank Peterson). Administrative Official During the Absence of Direction to the Finance Director to Publish the Kodiak Island Borough Manager. the 2012 Roll of Real Properties Subject to Resolution No. FY2013 -26 (Adopting a Foreclosure. Federal Capital Improvement Program and *Confirmation of Assembly Appointment to the Board of Equalization (Ed Mahoney). MANAGER'S COMMENTS CLERK'S COMMENTS MAYOR'S COMMENTS ASSEMBLY MEMBERS COMMENTS 2009 Air photo Page 1 of 2 HOME WHO WE ARE SUN'AQ TRIBAL ENTERPRISES: WILDSOURCE APPLICA'T'IONS JOBS NATURAL RESOURCES SFAFFBIOS EiYki'J SUN � f r.: � yGt Tribe of Kodiak Tribe News • Who We Are admin area Cama'i ( "Welcome") Log 1° Entries RSS We are the Sun'aq Tribe of Kodiak, a federally recognized Alaska Native tribe. We represent 1,500+ Sun'aq tribal members who reside on the island of Kodiak, on other islands in the Comments RSS Kodiak Archipelago, elsewhere in Alaska and Hawaii, and in the lower 48 states. WordPress.org Dedicated to the Reunification of Our People Tribal events We are dedicated to rebuilding our traditional political and cultural institutions and practices. Our tribe strives to build and support Sun'aq Tribal unity and cultural identity and lifeways. u February 2013 » Our Subsistence Lifestyle se tic Tu •Se Tn Fr So 2 We are one of 10 Alutiiq tribes that lived in large coastal villages along the shores of the 3 4 6 6 7 8 9 Alaska Peninsula, the Kenai Peninsula, and the Kodiak Archipelago 7,500 to 8,000 years 10 a 12 13 14 15 16 ago. Our tribe settled permanently where the city of Kodiak is now located about 2,500 years 17 18 19 20 21 22 23 ago and interacted regularly with other tribes throughout the archipelago. 24 _25 26 22 28 Our ancestors followed an elaborate maritime subsistence lifestyle of hunting, fishing, and cvicenwM xiarae osnea gathering throughout the year. Subsistence has special meaning for Alaska Natives and refers to a way of living that emphasizes the importance of respecting the land and its resources, as well as acknowledging a connection to the natural world. Our people today blend the traditional lifeways of our ancestors with the customs and practices of the many nations w who have come to our island and stayed to become a part of our community. These include Russians, Scandinavians, Chinese, and Americans. Some Sun'aq practice subsistence for spiritual and cultural reasons; other tribal members rely on our island's resources for material well-being. Many tribal members fish independently or work for the local canneries, while still practicing a subsistence lifestyle. Exxon checks returned /Need addresses Exxon cheeks returned /Need We ha.vc recicved a few Exxon checks back due to incorrect addresses, If you have not reciuved your addresses check yet, please see the list below. If you are on the list, please contact us to update your address. We have reciuved a few Exxon checks hack due to You can call Sun'aq at 907- 486 -4449 and ask for Enrollment or you can email execadmin @sunaq.org incorrect addresses. If you have not recicved your check with your updated address. yet, please see the list below. If you are on the list, please Janyce U. Hamilton contact us to update your address. You can call Sun'aq at Nina Weatherly 907 - 486 -4449 and ask for Enrollment or you can email Tatiana M. Hernandez execadmin @sunaq.org with your updated address. Terrence K. Cook Janyce D. Hamilton Matthew A. Gregory Nina Weatherly Dennis G. Laurel Tatiana M. Hernandez Lisa T. Abbas Terrence K. Cook Steven U. Eaglet Matthew A. Gregory t.a.... / / ..... .... .......... ......6..L,. ..... ..�..f '1 Pl4 /Ini') 2009 Air photo Page 1 of 4 HOME WHO WE ARE SLIN'AQ TRIBAL ENTERPRISES: WILDSOURCE APPLICATIONS JOBS NATURAL RESOURCES STAFF BIOS ry a Tribe of Kodiak Tribe News Staff BIOS admin area Our tribal staff of 16+ runs a 6,000- square foot office in the Sun'aq Tribal Center building in Log in downtown Kodiak, Alaska. Our administrative offices are on the second floor of the Sun'aq Entries RSS Tribal Center which is located in beautiful downtown Kodiak. r Comments RSS z, Virginia Abston, Finance Director I WordPress.org Virginia has worked with Sun'aq Tribe since 1987 in a variety of positions. Tribal events She is an Alaska Native and has lived her entire tile in Kodiak. When not we:king for Sun'aq Tribal Council, Virginia operates her famity's fish net sites and likes to quill and weave baskets. She is a graduate of Kodiak High u February 2013 u School and Kodiak College. Su mu Tu l':e Th Fr Se Gloria Bishop, Domestic Violence Grant Coordinator/Women's Advocate 1. 3 4 6 7 8 9 10 11 12 13 14 15 16 Clone Bishop is dedicated to the prevention and elimination of domestic violence and sexual 17 18 19 20 21 22 23 assault in our community and is aimed to empower native women for happy po PPY antl healthy 24 X25 26 27 28 lives without violence. c/ - Can la:, by gm-ran O'Shea Traci Marsh, Administration Assistant -- . 4 r •, `: r T.r 4 X I Traci Marsh was born 8 raised in Kodiak, Alaska. She is the daughter of Len - at ti " + 8 Anita Carpenter. Traci joined Sun'aq in 2011 8 is very proud to be part the , t Er � ..r , x loan. She is a Alaska Native Eskimo t. enjoys sports 8 commercial fishing i, f t .. - with her family in the summer's. On Traci's free time her creativity goes , towards photography 8 art which she has been doing since the age of 14. �,1* � • ?roof plans to attend the Kodiak Alaska College to achieve. a asscslate's 1� t,78 3 __ J photography degree. An important aspect of her file is her family. Ste plans to reside in Kodiak with her Husband Ryan & daughter Lena. Bob Polasky, Sun'aq Tribal Administrator - - - - -- _� X Bob joined the tribe in 2003 after serving in similar positions of leadership and responsibility wish Mal:ah Tribe of Waslringgton Stale; the Confederated Tribes of Coos, Lower Umpqua. and Siusiaw Indians: and Silka tribe of Alaska. He is en experienced leader any advoc.ae in the areas of rural subsistence rights. having testified before Congressional committees and lobbied at the United Nations in behalf of -- J Native subsistence rights. Mr. Polasky has been recognized for his "outstanding contributions to rural Alaskans" by the Rural Alaska Community Action Program. Linda Resoff, Social Services DirectortCWA and Tribal Courts '1 PI A/1r119 2009 Air photo Page 2 of 4 • employment and training, welfare case management, child welfare, domestic violence and tobacco education. She Io'es working with the Native people of Exxon checks returned /Need Kodiak and is committed to Sun'aq's strong view of promoting education first. addresses We have recieved a few Exxon checks back due to Patsy Hester. Executive Assistant incorrect addresses. If you have not recieved your check yet. please see the list below. If you are on the list, please contact us to update your address. You can call Sun'aq at 907-486-4449 and ask for Enrollment or you can email execadmin @sunaq.org with your updated address. Janyce D. Hamilton Nina Weatherly De /ores Stokes, Accounts Payablc / Sun'aq Tribal Enterprises Taliana M. Hernandez Terrence K. Cook Delores moved to Kodiak from Sand Point, Alaska, and joined the staff to Matthew A. Gregory implement Sun'aq Itibe's Enrollment Program in 2003. An Alaska Native, she Dennis G. Lauren Lisa T. Abbas has previous experience working with tribal councils and spent several years Steven D. Eagteston as an executive assistant for the school district central office in Sand Point. Michael J. Chya She is familiar with state-of- the -art software programs used in tribal enrollment Diane A. Sandvick Gary B. Shearer Karen D. Shearer Cynthia Houser Linda Resoft. Tribal Court Administrator E91sse Lind John R. O'Neill Our Tribal Court Committee met May 1, 2010 to review cur Tribal Court Judge candidates Do you want to learn or support the and to move forward with training for the judges. The committee approved two candidates, Eric Olsen and Johnny Reft from the applications. The new judges will be attending Tribal Alutiiq Language? Court Development training with the National Judicial College in Fairbanks from August 91h - Several organizations within the Kodiak Alutiiq region have August 11th, 2010. prepared a survey intended to identify individuals interested in learning the Kodiak Alutiiq language and how to best support them. If you are interested in learning Kodiak Alutiiq please complete Frank Peterson Jr., Programs Services Director =_= a survey at: www. zogrnerano ,cOm /Survev/WEB22B933KV8QR x. Sun'aq Tribe of Kodiak has a Notary Frank Peterson was raised on Kodiak Island in different communities including AAhiok, Larsen Bay, Public on site Old Harbor and the City of Kodiak. As Sun'aq's Sun'aq Tribe of Kodiak is proud to announce that we have a economic development planner, he will be crafting a Notary Public on site for any members, tree of charge. Please long term economic development strategy for the contact Patricia Hester at 426 -4449 if you need assistance with Tribe, researching and recommending possible notarizing a document. tribal enterprises. He also assists tribal members - -- interested in starling their own businesses and others in business wishing to improve or expand. Frank worked le' the Kodiak Area Native Association as the Environmental Coordinator. Tribal Operations Coordinator end Village Public Safety Officer Coordinator. Frank worked for :C.A.N.A. for two years before becoming a City of Kodiak Police Officer. While a Police Officer for the City of Kodiak Frnnk's National Guard uni! was activated to serve 18 months in Baghdad. Iraq. l rank served honorably during his tour in Iraq and returned in March of 2006. In August of 2007. , 13; Gars of military service. Frank vies honorably discharged from the Amry NE 1101181 Guard. Dank is merrier' to Shelly Roberts Peterson. They have 4 sons, and their names we Merrick. Tyler, I.uthe: end Aiden. Franks background has made him an strong asset to the Sun'aq Tribe of Kodiek's 1 eam. Rick Rowland, Natural Resources Director Rick is Alutiiq from Alognak. Following the 1964 Earthquake and Tsunami he moved wish his mother, Tina 'TOotsie " Larsen and Grandmother, Olga Larsen, along with four sisters to the newly created village of Port Lions. In 1972 his APIA rill ro 2009 Air photo Page 3 of 4 famiry moved to the village of Old Harbor. because his mother wanted to live a more traditional native lifestyle. where he eventually graduated from High School before joining and serving eight years in the United States Marine Corps touring the United States, Cuba, Japan, Korea, Phillipines. and the South China Sea. After serving his country as an infantryman, a water safety survival instructor, international scuba diver, a marine - recruit marksmanship instructor, a long range marksman. and competitor, he was honorably dishcarged as a non - commissioned officer with the rank of Sergeant in 1989, Upon returning to Kodiak Island to follow a lifestyle of commercial fishing, the Exxon Valdez oil spill changed his path and he set a goal to attend the University of Alaska, Anchorage for his Bachelors of Education Degree, which he obtained in 2002. He previously served ten years as a Director for Afognak Native Corporation, a Governing Board Member for Alutiiq, LLC, and was an interim - tribal council member for the Native Village of Afognak, while it was created. plus assisted in the development of the Dig Afognak Program. Licensed as a 100 Ton Master Merchant Marine Pilot. He has owned a sports - fishing charter guide business and has guided big game hunts in California and Alaska, as well as living a traditional hunting and fishing lifestyle. He currently holds the position of Natural Resources Director for the Sun'aq Tribe of Kodiak. Sarah Lind, Youth Advocate Sarah Lind was born to Larry Lind and Laura Waage right here in 7 r Kodiak, Alaska. She was raised t here in Kodiak. and continues to call i a► . �� • it home for herself and her two ` L� children, lzetria (Izzy) and Alethea xikl; /1IA (Ma/. Sarah ran a licensed daycare `- =' J for 8 years, and believes this is —'�- -- - what gives her her love for children, and the desire to see them succeed. As the Youth Advocate for Sun'aq Tribe, Sarah will often take kids to school, tutor them. and mentor them as they face the stresses of today's school demands. Sarah came to Sun'aq in January of 2070 and has since developed many helpful programs to benefit our local native youth! K Pamela Bumsted, Environmental Resources Pa.n is the Environrnonlel Pro ect Manager for the ANA Capacity Building Project. She is excited to be a pert of our Environmental CnpacJy Building Project and is to work with members about Tradilionat Ecotr.gicol knowledge! Exxon checks returned /Need addresses We have recieved a few Exxon chocks back due to incorrect addresses. I1 you have not nxieved your check yet, please see the list below. If you are on the list, please contact us to update your address. You can call Sun'aq at 007- 486 -4449 and ask for Enrollment or you can email execadmin©sunaq.org with your updated address. Janyce U. Hamilton Nina Weatherly Tatiara M. Hernandez Terrence K. Cook Matthew A. Gregory Dennis C. Laurel Lisa T. Abbas Stever. U. Eagleston Michael J. Chya r1 hl AYlrl1'1 • ° ° ° Alutiiq Museum ° o s 0 and Archaeological Repository 01/4",3 215 Mission Road, Suite 101 • Kodiak, Alaska 99615 • Ne (907) 486 - 7004 • FAX 907 486 - 7048 •tl. www.alutiiqmuseum.org _ L I j February 6, 2013 Mayor Jerome Selby - jl Kodiak Island Borough P.O. Box 1962 I F - 7 201$ l ' • Kodiak, AK 99615 Re: Funding for Museum Climate Control f l t l lli 'H C I r R ' KSOF IVL Dear Mayor Selby, l; Coma'i — Hello. Thank you for your recent visit to the Alutiiq Museum and for taking the time to learn about our facilities projects. At nearly 20 years old, the museum is working to update and maintain its well -used space. As you witnessed, our gallery renovation is underway. Although this is the most visible sign of our work, we are also raising money for essential improvements to our collections care program — reestablishing climate control and expanding storage. We are working hard to maintain our position as one of the premier tourism locations in Kodiak. Most critically, the museum's environmental control machinery is no longer operational and cannot be repaired. This is a dangerous situation for our collections, which require stable conditions for preservation. We are preparing applications to the Rasmuson Foundation and the MJ Murdock Charitable Trust for substantial grants to assist in the replacement of this machinery, and provide badly need storage improvements, but we have been advised that a successful application will require a meaningful local match. Although, the amount of that match is not specified, it is necessary for the museum to show community support. A grant from the Kodiak Island Borough would demonstrate community contribution and help us to bring major grant funds to Kodiak. In short, it would leverage additional funding. As suggested, we have completed a request to the Kodiak Island Borough for funding to assist with the HVAC system replacement for the 2012 -2013 funding cycle. We have returned this application to the Borough Clerk, but I am attaching a copy for your review as well. This is a large project, larger than the typical KIB grant. Please note that we have additional information on its implementation that we would be happy to share with you or present to the Borough Assembly. We have developed a detailed project budget, identified contractors, set a schedule for completion and organized our projects and resources to insure that we can reestablish climate control successfully. We thank you for your consideration. Please let me know if you have any questions. Quyanaa — Thank you, G r ,- f Sven D. Haakanson, Jr., PhD Executive Director sven@alutiiqmuseum.org 907-486-7004, x27 Enc. Alutiiq Museum Non - Profit Grant Application to the KIB The Alums Museum is a non -profit organization dedicated to preserving and sharing the cultural traditions of the Alums, a Native Alaskan people It is governed by representatives or Kodiak's Munk/ Corporations, 'rith funding from charitable contributions, memberships, grants and sales. KODIAK ISLAND BOROUGH APPLICATION FOR NON - PROFIT CORPORATION FUNDING Agency Overview Agency Name: Alutiiq Museum & Archaeological Repository Physical Address: 215 Mission Road, Suite 101, Kodiak, AK 99615 Mailing Address: 215 Mission Road, Suite 101, Kodiak, AK 99615 Telephone: 907- 486 -7004 Fax: 907 - 486 -7048 E -mail: sven @alutiqmuseum.org Federal Employer Tax ID Number: Name of Director or Contact Person: Sven Haakanson, Jr., Ph.D. List of Board Members and Officers: Will Anderson (Chair), Margaret Roberts (Vice Chair), Perry Eaton (Treasurer), Donene Tweten (Secretary), Jay Baldwin, Margie Bezona, Fred Coyle, Tanya Inga, Loretta Nelson, Gordon Pullar, Andy Teuber Is agency a 501(c)3? Yes X No If yes, please provide letter from the IRS signifying agency's official non - profit tax exemption status. If you have previously provided the Borough with this letter, please disregard. Please see attached letter. If no, have you applied for 501(c)3 status? Yes N o Please provide the organization's Mission Statement. The Alutiiq Museum's mission is to preserve the prehistoric and historic cultural traditions of the Alutiiq people and promote greater public awareness of the rich cultural legacy of all the indigenous societies of the Alaskan Gulf coast. In pursuit of these goals, the museum collects and preserves archaeological, ethnological, and archival materials from the Alutiiq Nation in a repository that is accessible to the public. The organization supports research on Alutiiq culture and history, and disseminates the results through exhibits, publications, and scholarly presentations. SERVICES Please give a brief description of the organization's current programs in priority. The Alutiiq Museum cares for over 250,000 objects and photos that reflect the history of Kodiak's Alutiiq people. The Museum's program's interpret these items and at present include — an exhibit gallery with children's corner and video station, the Alutiiq Word of the Week, Community Archaeology, Traveling Traditions, The New Sewer's Club, Second Saturday Youth activities, and much more. 1 Non - Profit Application /Grant Report The Kodiak Island Borough does not fund religious programs. Are your agency's services faith - based? Yes No X If yes, how do you plan to use the Borough funding? Explain how your organization's programs fall within the powers of the Kodiak Island Borough. Those municipal powers include education, health, economic development, solid waste, animal control, parks, community welfare, fire protection, road services, and scientific research. The museum's exhibits, programs, and resources (1) provide community education, (2) advance pride in Native ancestry to build healthier communities, (3) support the tourist industry and economic opportunities for local artists, (4) advance knowledge of Kodiak's culture and environment through scientific research, and (5) promote historic preservation. Museum funded archaeological research on KIB lands has assisted with the care of sites, and provided valuable information for land management and development. Extensive outreach to local schools has expanded understandings of local history and appreciation for Kodiak's cultural diversity. Are agency's services delivered island -wide? Yes X No If not, please list service delivery area. Are agency's services open to all residents of the Kodiak Island Borough? Yes X No If not, please explain. How does the agency collaborate with other local non - profits? The Alutiiq Museum works with the Kodiak Historical Society to share information and objects, host programs, create resources, and share training opportunities. We join the Kodiak Arts Council in arts initiatives and educational programs, collaborate with KMXT on weekly cultural programming, assist Explore Kodiak with its visitors guide, share resources with local libraries, and work with tribal organizations on historic preservation and cultural education. How does the agency use volunteers? Volunteers assist the Alutiiq Museum with collections care, participate in archaeological research, monitor and report on the condition of archaeological sites around the archipelago, provide professional advice on the care of collections and exhibit design, share the Alutiiq language, assist with events, and give their time to teach Alutiiq traditions to people of all ages. We have about 100 volunteers a year. FINANCIAL INFORMATION Is your agency audited? Yes X No If yes, please attached annual audited financial report. If not audited, please attach agency's latest annual financial statement. TOTAL FUNDING RQUEST What is the agency's funding request of the Kodiak Island Borough? $25,000 2 Non - Profit Application /Grant Report How will the funds be used? The Alutiiq Museum's facilities are aging. Built in 1995 to repository standards, parts of the museum's physical plant are now obsolete or inefficient. In particular, the climate control system that provided stable temperature and humidity for delicate artifacts is not functioning. Despite rigorous efforts to maintain this machinery, the parts necessary to repair it are no longer manufactured. The museum must now replace the system, as well as two climate loggers, and two sets of poorly insulated exterior doors to reestablish an appropriate environment for its large collections. Additionally, the museum has filled its collections storage to capacity. The successful return of archaeological materials, curation agreements, community contributions, and local research have filled our shelves. It will soon be impossible to accept new materials or to conduct collections generating research. Moreover, the weight of collections is stressing floors and shelving. Heavy stone artifacts need to be moved to improve storage safety. To address its aging, full facilities, the museum developed the Alutiiq Collections Environment project (ACE). This project will create a stable climate and expand storage to sustain the museum's collections program with assistance from the Rasmuson Foundation and the MJ Murdock Charitable Trust. The project will begin with the installation of two new HVAC units, two climate data loggers, two better insulated exterior doors, disposal of old HVAC units, and train staff on HVAC operation. Phase two will involve expanding collections storage to the basement of the Alutiiq center with new shelving and security. This project is part of a larger effort to renew museum facilities and sustain professional activities in the coming decades. The museum is currently refreshing its gallery and planning a renovation of its store. Together these projects will help to meet future community needs for curation, heritage education, and economic development. Importantly, it maintains the museum's standing as a vital part of Kodiak's tourism industry. Updated facilities and environmental controls demonstrate the value of Alutiiq heritage to our visitors, and maintain the museum's reputation as a premier destination. We ask the Kodiak Island Borough to assist this effort, with a grant to the HVAC repair phase of the project. This will assist us in leveraging larger donations from foundations with a local match. OTHER FUNDING SOURCES List amount of funds your agency received from other sources for this past fiscal year: Federal: Administration for Native Americans, language resource development, $19,291 Institute for Museum and Library Services, educational programming, $34,491 National Park Service, archaeological monitoring, $54,639 National Science Foundation, langue research and documentation, $27,887 US Forest Service, curation, $3,012 State: Alaska State Museum Grant in Aid, exhibit production grant, $5,514 Alaska State Council for the Arts, operating support $18,000 City: None Parent Organization: None 3 Non - Profit Application /Grant Report Corporate Grants: None Foundations: Alutiiq Heritage Endowment Foundation, operating, $44,602 First Alaskans Institute, educational programming in villages, $13,034 Museums Alaska, art acquisition, $25,000 Rasmuson Foundation, gallery remodel, $34,279 Client Fees: Contract Archaeology, $44,840 Donations: Afognak Native Corporation, $35,000 Anonymous, $24,025 Akhiok - Kaguyak, Inc., $7,500 Kodiak Area Native Association, $34,789 Koniag, Inc., $5,000 Leisnoi, Inc., $5,000 Local Community Sponsors, $9,350 Natives of Kodiak, $20,000 Old Harbor Native Corporation, $25,000 Public, $27,436 Interest: Interest Income, $231 Gaming Permit Activities: Gold Cache Bingo, Anchorage, $112,727 Crossing Guard Duty: None If you receive state of federal grants, what is the percentage and amount of local match that is required for each grant your agency receives? Matching requirements vary by grant and can range from 0% to 50 %. There is no set match for the A.C.E. project propose here. However, in a design review, the Rasmuson Foundation indicated that they would not provide funding without a substantial local match. Natives of Kodiak, Inc. has pledged in -kind support through the use of basement storage space. A KW donation would provide a critical cash match for the application and use local funds to leverage large donations from both the Rasmuson Foundation and the MJ Murdoch Charitable Trust. 4 Non - Profit Application /Grant Report What effects will there be and what alternative plan does your agency have if KIB funding is not received? If the KIB is unable to support this project, the Alutiiq Museum will continue to look for sources of local funding. This could include private sponsorships or donations. The project is essential to the health of museum collections, and to maintaining organizational accreditation and tourism appeal. It will not be dropped. Did your organization receive funding from the Kodiak Island Borough during the last fiscal year (July 1, 2011 — June 30 2012)? Yes No X If yes, please complete the attached grant report and submit it with this application. 5 Non - Profit Application /Grant Report INTERNAL REVENUE SERVICE DEPARTMENT OF THE TREASURY DISTRICT DIRECTOR P. 0. BOX 2508 CINCINNATI, OH 45201 Employer Identification Number: Date: AUG 2 2 1997 92- 0150422 DLN: 17053148086007 ALUTIIQ HERITAGE FOUNDATION Contact Person: C/O ALUTIIQ MUSEUM & ARCHAEOLOGICA E0 CUSTOMER SERVICE REPOSITORY Contact Telephone Number: 215 MISSION RD STE 101 (213) 894 -2289 KODIAK, AK 99615 Accounting Period Ending: June 30 Addendum Applies: No Dear Applicant: Based on information you supplied, and assuming your operations will be as stated in your application for recognition of exemption, we have determined you are exempt from federal income tax under section 501(a) of the Internal Revenue Code as an organization described in section 501(c)(3). We also determined that you are a private foundation within the meaning of section 509(a) of the Code. Based on the information you submitted with your application, we have determined that you are likely to qualify as a private operating foundation described in section 4942(j) (3) of the Code. Accordingly, you are treated as a private operating foundation for your first year. After that, you will be treated as a private operating foundation as long as you continue to meet the requirements of section 4942(j) (3). This ruling satisfies the good faith determination requirement of section 53.4942(b) -3(b) (2) of the Excise Tax Regulations. If you change your sources of support, your purposes, character, or method of operation, please let us know so we can consider the effect of the change on your exempt status and foundation status. If you amend your organizational document or bylaws, please send us a copy of the amended document or bylaws. Also, let us know any changes in your name or address. As of January 1, 1984, you are liable for social security taxes under the Federal Insurance Contributions Act on amounts of $100 or more you pay to each of your employees during a calendar year. You are not liable for the tax imposed under the Federal Unemployment Tax Act (FUTA). However, since you are a private foundation, you are subject to excise taxes under Chapter 42 of the Code. You also may be subject to other Federal excise taxes. If you have any questions about excise, employment, or other Federal taxes, please let us know. Donors may deduct contributions to you as provided in section 170 of the Code. Bequests, legacies, devises, transfers, or gifts to you or for your use are deductible for federal estate and gift tax purposes if they meet the applicable provisions of sections 2055, 2106, and 2522 of the Code. Donors may deduct contributions only to the extent their contributions are Letter 1075 (DO /CG) -2- ALUTIIQ HERITAGE FOUNDATION gifts, with no consideration received. Ticket purchases and similar payments in conjunction with fundraising events may not necessarily qualify as deduct- ible contributions, depending on the circumstances. See Publication 1391, which sets forth guidelines on when payments made by taxpayers for admission to, or other participation in fundraising activities for charity are deductible as charitable contributions. You are required to file Form 990 -PF, Return of Private Foundation or Section 4947(a) (1) Trust Treated as a Private Foundation- Form 990 -PF must be filed by the 15th day of the fifth month after the end of your annual account- ing period. A penalty of $10 a day is charged when a return is filed late, unless there is reasonable cause for the delay. However, the maximum penalty charged cannot exceed $5,000 or 5 percent of your gross receipts for the year, whichever is less. This penalty may also be charged if a return is not complete, so please be sure your return is complete before you file it. You are not required to file federal income tax returns unless you are subject to the tax on unrelated business income under section 511 of the Code. If you are subject to this tax, you must file an income tax return on Form 990 -T, Exempt Organization Business Income Tax Return. In this letter we are not determining whether any of your present or proposed activities are unrelated trade or business as defined in section 513 of the Code. You need an employer identification number even if you have no employees. If you did not enter an employer identification number on your application, we will assign a number to you and let you know. Please use that number on all returns you file and in all correspondence with the Internal Revenue Service. This determination is based on evidence that your funds are dedicated to the purposes listed in section 501(c) (3) of the Code. To assure your continued exemption, you should keep records to show that funds are spent only for those purposes. If you distribute funds to other organizations, your records should show whether they are exempt under section 501(c) (3)- In cases where the recipient organization is not exempt under section 501(c) (3), you must have evidence that the funds will remain dedicated to the required purposes and that the recipient will use the funds for those purposes. If you distribute funds to individuals, you should keep case histories showing the recipients' names, addresses, purposes of awards, manner of selec- tion, and relationship (if any) to members, officers, trustees or donors of funds to you, so that you can substantiate upon request by the Internal Revenue Service any and all distributions you made to individuals. (Revenue Ruling 56 -304, C.B. 1956 -2, page 306.) We considered your grant- making procedures under section 4945(g) of the Code. Based on the information submitted and assuming your scholarship program will be conducted as proposed with objectivity and nondiscrimination in award- ing grants, we determined that your procedures in awarding scholarship grants comply with the requirements of section 4945(g) (1). This means that scholar- ships granted according to these procedures will not be "taxable expenditures" Letter 1075 (DO /CG) -3- ALUPIIQ HERITAGE FOUNDATION within the meaning of section 4945(d) (3). This determination is conditioned on the understanding that there will be no material change in the facts upon which it is based. It is further condi- tioned on the premise that no grants will be awarded to the trust's creators, trustees, or members of the selection committee, or for a purpose that is inconsistent with the purposes described in section 170(c) (2) (B). The approval of your grant- making procedures is a one -time approval of your system of standards and procedures that will result in grants that meet the requirements of section 4945(g) (1). Thus, approval will apply to suc- ceeding grant programs only as long as the standards and procedures under which they are conducted do not differ materially from those described in your request. We have not considered whether grants made under your procedures are ex- cludable from the gross income of recipients under section 117(a) of the Code. Any funds you distribute to individuals must be made on a true charitable basis to further the purposes for which you are organized. Therefore, you should maintain adequate records and case histories so that all grant distri- butions can be substantiated upon request by the Internal Revenue Service. If we have indicated in the heading of this letter that an addendum applies, the addendum enclosed is an integral part of this letter. Because this letter could help resolve any questions about your exempt status and private foundation status, you should keep it for your records. If you have any questions, please contact the person whose name and telephone number are shown in the heading of this letter. sincerely yours, District Director Letter 1075 (DO /CG) INTEPJTAL REVENUE SERVICE DEPARTMENT OP THE TREASURY P. O. BCE 2508 CINCINNATI, 07 45201 (� Employer Identification Number: ry Date: JAN 0 l 20041 92- 0150422 D LPI : 503253002 ALUTIIQ HERITAGE FOUNDATION Contact Person: 215 MISSION RD STE 101 DANIEL P SHANNON ID)) 31320 KODIAK, AK 99615 -6327 Contact Telephone Number: (877) 829 -5500 60 Month Period Ends: June 30, 2008 Addendum Applies: No Dear Applicant: We have received your notification of intent to terminate your private foundation status under section 507(b) (1) (B) of the Internal Revenue Code dur- ing a 50 month period beginning July 1, 2003. The information submitted indicates that you intend to operate as an or- ganization described in section 509(a) (2) of the Code during the 60 month period. Based on your proposed activities and support, it is held that you can reasonably be expected to terminate your private foundation status under sec- tion 507(b) (1) (B) of the Code. Accordingly, you will be treated as a public charity described in section 509(a) (2) of the Code for an advance ruling period of 60 months beginning July 1, 2003. within 90 days after the end of your 60 month period, you must establish to the satisfaction of the Internal Revenue Service that you have qualified as an organization which meets the requirements of paragraph (1), (2), or (3) of section 509(a) of the Code for the 60 month period. If you do establish that fact, you will be so classified for all purposes beginning with the first day of the first taxable year of the EO month period and, thereafter, so long as you continue to meet the requirements of section 509(a) (1), (2), or (3). If, however, you do not meet these requirements for the 60 month period, you will be classified as a private foundation as of the first day of the first taxable year of the 60 month period. If you satisfy the requirements of section 507(b) (1)(B) of the Code at the end of your 60 month period, you will not be subject to the provisions of section 507(a), (c), or (g) of the Code. Grantors and donors may rely on the determination that you are not a pri- vate foundation until 90 days after the end of your advance ruling period. If you submit the required information within the 90 days, grantors and contri- butors may continue to rely on the advance determination until the Service makes a final determination of your foundation status. Letter 2245 (DO/C64) a ALUTIIQ HERITAGE FOtRIDATIni 'Lou are required to file Form 990 -PF, Return of Private Foundation or Section 4947(a) (1) Trust Treated as a Private Foundation, until you complete your 60 month termination and are classified as a section 509(a) (2) organi- zation. Form 990 -PF must be filed by the 15th day of the fifth month after the end of your annual accounting period. The law imposes a penalty of $20 a day, up to a maximum of $10,000 or 5 percent of your gross receipts (whichever is less), for failure to file a return on time unless there is reasonable cause for the delay. For organizations with gross receipts exceeding $1,000,000 in any year, the penalty is $100 per day per return, unless there is reasonable cause for the delay. The maximum penalty for an organization with gross receipts exceeding $1,000,000 shall not exceed $50,000. This penalty may also be charged if a return is not complete, so please be sure your return is complete before you file it. If you do not pay the tax imposed by section 4940 of the Code for any taxable year or years during the 60 month period, and it is subsequently determined that such tax is due for such year or years, you will be liable for interest in accordance with section 6601 of the Code. Since any failure to pay such taxes during the 60 month period is due to reasonable cause, the penalty under section 6651 with respect to the tax imposed by section 4940 shall not apply. If the heading of this letter indicate that an addendum applies, the addendum enclosed is an integral part of this letter. Because this letter could help resolve any cuestions about your exempt status and foundation status, you should keep it in your permanent records. We have sent a copy of this letter to your representative as indicated in your power of attorney. If you have any questions, 'please contact the person whose name and telephone number are shown in the heading of this letter. Sincerely yours, Lois C. Lerner Director, Exempt Organizations Rulings and Agreements Enclosure(s): Form 872 Letter 224; (DO/CC) Alutiiq Heritage Foundation Audited Financial Statements Year Ending December 31, 2011 Alutiiq Heritage Foundation Table of Contents Page Independent Auditors' Report 1 Financial Statements Statement of Financial Position 2 Statement of Activities 3 Statement of Functional Expenses 4 Statement of Cash Flows 5 Notes to Financial Statements 6 -10 ACCOUNTING FORENSIC SERVICES, P.C. { c_. dru ? '— :*: ralM::'. M ∎MMI S8 n . . siEf.'L",`.:,e ... s;, „ ..., C. ITME5 ?L:°_4' 1 q - > CD W Independent Auditors' Report To the Board of Directors Alutiiq Heritage Foundation Kodiak, Alaska We have audited the accompanying statement of financial position of Alutiiq Heritage Foundation (a non - profit Corporation), as of December 31, 2011 and the related statement of activities, functional expenses and cash flows for the year then ended. These financial statements are the responsibility of the Organization's management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Alutiiq Heritage Foundation as of December 31, 2011, and the activities, functional expenses, and cash flows for the year then ended in conformity with accounting principles generally accepted in the United States of America. r� July 23, 2012 626 Cordova Street, Suite 103, Anchorage, Alaska 99501 Phone 907 - 334-9501 Fox 907- 334 -9502 William ./ Schmid, CPA (cell 907- 317 -26111 Susan M. Spyker, CPA, CVA, CFFA (cell 907 -351 -3745) Alutiiq Heritage Foundation Statement of Financial Position December 31, 2011 Assets Cash and cash equivalents: Unrestricted $ 378,002 Temporarily restricted 24,000 Accounts receivable: Grants 66,523 Other 69,014 Inventory 77,155 Total current assets 614,694 Collections (Note 4) - Property and equipment - net of accumulated depreciation 170,389 $ 785,083 Liabilities and Net Assets Accounts payable $ 22,693 Payroll and payroll tax liabilities 18,953 Accrued leave 16,624 Deferred revenue 21,455 Total current liabilities 79,725 Net Assets: Unrestricted: Designated: Investment in property and equipment 317,455 Undesignated 363,903 Total unrestricted net assets 681,358 Temporarily restricted 24,000 Permanently restricted - Total net assets 705,358 $ 785,083 See accompanying notes. 2 Alutiiq Heritage Foundation Statement of Activities For the Year Ended December 31, 2011 Temporarily Operating activities: Unrestricted Restricted Total Support: Member dues $ 17,717 $ - $ 17,717 . Contributions: Individuals 71,270 24,000 95,270 Corporations 264,265 - 264,265 Government 140,866 - 140,866 Foundations 104,898 - 104,898 Net assets released from restriction: Purpose restriction met 52,583 (52,583) - Subtotal support 651,599 (28,583) 623,016 Revenue: Fundraising 150,825 - 150,825 Admissions 16,235 - 16,235 Store sales, net of cost of goods sold of $69,405 28,080 - 28,080 Other 34,677 - 34,677 Subtotal revenue 229,817 - 229,817 Total support and revenue 881,416 (28,583) 852,833 Expenses: Program services: Museum 607,245 - 607,245 Special projects 68,875 - 68,875 Support services: Management and general 225,261 - 225,261 Fund - raising 3,212 - 3,212 Total expenses 904,593 - 904,593 Change in net assets from operating activities (23,177) (28,583) (51,760) Non - operating activities: Interest 371 - 371 Gain (loss) on disposal of assets (540) (540) (169) - (169) Change in net assets (23,346) (28,583) (51,929) Net Assets - beginning of year 704,704 52,583 757,287 Net Assets - end of year $ 681,358 $ 24,000 $ 705,358 See accompanying notes. 3 Alutiiq Heritage Foundation Statement of Functional Expenses For the Year Ended December 31, 2011 Program Services Supporting Services Management Special and Fund Museum Projects General Raising Total Expenses: Personnel $ 417,898 $ - $ 139,299 $ - $ 557,197 Prof 8 contract services 14,834 28,078 4,302 - 47,214 Travel and training 21,801 8,826 11,558 - 42,185 Facilities 86,803 11,239 31,761 600 130,403 Special exhibits - - - - - Supplies 11,620 7,304 8,778 - 27,702 Accounting services - - 15,790 15,790 Insurance - - 5,784 - 5,784 Taxes and licenses - - - - - Advertising 5,954 9,000 3,068 - 18,022 Newsletter 10,751 - - - 10,751 Printing - - - - - Acquisitions - - - - - Gaming - - - 2,612 2,612 Moving and storage - 2,053 - - 2,053 Dues and subscriptions 2,794 - - - 2,794 Other 13,195 2,375 1,106 - 16,676 Depreciation 21,595 - 3,815 - 25,410 $ 607,245 $ 68,875 $ 225,261 $ 3,212 $ 904,593 See accompanying notes. 4 Alutiiq Heritage Foundation Statements of Cash Flows For the Year Ending December 31, 2011 Cash Flows From Operating Activities Decrease in net assets $ (51,929) Adjustments to reconcile change in net assets to net cash provided by operating activities: Depreciation expense 25,410 Capitalization of donated equipment (20,835) Loss on disposal of fixed assets 540 (Increase) decrease in current assets: Accounts receivable 89,812 Inventory 7,585 Prepaid expenses 351 Increase (decrease) in current liabilities: Accounts payable 3,971 Payroll and payroll tax liabilities (4,960) Accrued leave (4,940) Deferred revenue (3,012) Net cash provided by operating activities 41,993 Cash Flows From Investing Activities Acquisition of property and equipment (73,441) Net cash (used) by investing activities (73,441) Net (Decrease) in Cash (31,448) Cash - beginning of year 433,450 Cash - end of year $ 402,002 Cash and cash equivalents is presented on the Statement of Financial Position as follows: Unrestricted $ 378,002 Temporarily restricted 24,000 $ 402,002 See accompanying notes. 5 Alutiiq Heritage Foundation Notes To Financial Statements December 31, 2011 Note 1 — Summary of Significant Accounting Policies Operations Alutiiq Heritage Foundation (Foundation), a nonprofit corporation, incorporated in the State of Alaska that is dedicated to preserving the prehistoric and historic traditions of the Alutiiq peoples who inhabit the central Gulf of Alaska region. The Foundation operates exclusively for charitable, educational, scientific and literary purposes. In 2011 the Alutiiq Museum and Archaeological Repository received its accreditation by the American Association of Museums. Basis of Accounting The financial statements of the Organization have been prepared on the accrual basis of accounting. Basis of Presentation The financial statement presentation follows the recommendations of the Financial Accounting Standards Board in its Accounting Standards Codification; the Organization is required to report information regarding its financial position and activities according to three classes of net assets: • Unrestricted net assets represent that portion of net assets of the Foundation that are neither permanently nor temporarily restricted by donor - imposed stipulations. Temporarily restricted net assets represent assets of the Foundation whose use is limited by donor - imposed stipulations that either expire by the passage of time or can be fulfilled by actions of Alutiiq Heritage Foundation, When the stipulated time restriction ends or action is accomplished, temporarily restricted net assets are reclassified to unrestricted net assets and are reported in the statement of activities as net assets released from program restrictions. Permanently restricted net assets represent the part of the net assets from contributions whose use by the Foundation is limited by donor - imposed stipulations that neither expire by the passage of time nor can be otherwise removed by actions of the Foundation. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses. Actual results could differ from those estimates. Cash and Cash Equivalents For the purposes of the Statement of Cash Flows, the Foundation considers all highly liquid investments with an initial maturity of three months or less to be cash equivalents. Inventories Inventories are items for resale in the museum store and are stated at cost determined by the first -in, first -out method. 6 Alutiiq Heritage Foundation Notes To Financial Statements December 31, 2011 Note 1 - Summary of Significant Accounting Policies - continued Accounts Receivable Accounts receivable are stated at unpaid balances, less an allowance for doubtful accounts. The Foundation provides for losses on accounts receivable using the allowance method. The allowance is based on experience, third -party contracts, and other circumstances, which may affect the ability of clients to meet their obligations. It is the Foundation's policy to charge off uncollectible accounts receivable when management determines the receivable will not be collected. Management believes all receivables are collectable; therefore, no allowance was established. Property and Equipment Property and equipment are stated at cost. Expenses for maintenance and repairs are charged to expense as incurred, and expenses for major renovations are capitalized. All expenses for equipment in excess of $500 with a useful life of one year or longer, are capitalized. All donated properties are capitalized at the fair market value or estimated value at the time of receipt. Depreciation is provided over the estimated useful lives of the assets on a straight -line basis over the estimated useful lives of the assets. Property and equipment are depreciated over a range of 3 to10 years. Contributions Contributions and pledges are recorded in the period received in the appropriate class of net assets based upon any donor - imposed stipulations. All donor - restricted support is reported as an increase in temporarily or permanently restricted net assets depending on the nature of the restriction. When a restriction expires (that is, when a stipulated time restriction ends or purpose restriction is accomplished), temporarily restricted net assets are reclassified to unrestricted net assets and reported in the statement of activities as net assets released from restrictions. All temporarily restricted support received and released from restrictions within the same fiscal year are treated as unrestricted support. Annual Leave Annual leave is accrued as earned by employees and recorded as an expense in the period earned. Promises to Give Unconditional promises to give are recognized as revenue in the period received and as assets, decreases of liabilities, or expenses depending on the form of the benefits received. Promises to give are recorded at net realizable value if expected to be collected in one year and at fair value if expected to be collected in more than one year. Conditional promises to give are recognized when the conditions on which they depend are substantially met. Contract and Reimbursable Grant Revenues Contract revenues are recorded as earned. Reimbursable grant revenues are recorded as allowable costs are incurred allocable to the respective grants. 7 Alutiiq Heritage Foundation Notes To Financial Statements December 31, 2011 Note 1 • Summary of Significant Accounting Policies — continued Contributed Services, Materials and Utilities Donated services are included in the Foundation's Statement of Activities in the following circumstances: o The services performed create or enhance non - financial assets; or > The services require specialized skills, are provided by individuals possessing those skills, and would typically need to be purchased if not provided by donation. Donated services were recorded in the amount of $16,250. Donated equipment, materials, supplies and utilities are valued at fair market on the date contributed. Donated equipment was valued at $20,835 consisting of new computer hardware and software. Donated supplies were valued at $2,146, the cost to the donee. Expense Allocation The costs of providing various programs and other activities have been summarized on a functional basis in the Statement of Activities and Statement of Functional Expenses. Accordingly, certain costs have been allocated among the programs and supporting services benefited. Advertising Advertising is non - direct response and costs are expensed as incurred. Income Taxes The activities of the Foundation are exempt from federal income taxes under Internal Revenue Code Section 501(c)(3). Although the Foundation is exempt from federal income taxes, any income derived from unrelated business activities is subject to the requirements of filing Federal Income Tax Form 990 -T and a tax liability may be determined on these activities. Note 2 — Cash and Cash Equivalents The Foundation has the following cash on deposit at December 31, 2010: Bank Carrying Balance Amount Checking accounts $ 283,821 $ 276,945 Money Market account 125,027 125,057 $ 408,848 $ 402,002 8 Alutiiq Heritage Foundation Notes To Financial Statements December 31, 2011 Note 2 — Cash and Cash Equivalents - continued Bank balances are insured to $250,000 per institution through the Federal Deposit Insurance Corporation. Additionally, non - interest bearing transaction accounts with participating institutions are guaranteed by the FDIC to the balance maintained in the account. This is a temporary program effective through December 31, 2013. All balances are covered by FDIC programs. Note 3 — Temporarily Restricted Cash and Cash Equivalents A portion of cash and cash equivalents is shown as temporarily restricted on the Statement of Financial Position reflects the temporarily restricted net assets. The balance reflects unspent grant funds received with purpose restrictions. None of the cash or cash equivalents are held in restricted access accounts. Note 4 — Collections The Foundation maintains a collection of artifacts, pictures, artwork and replicas of various native crafts. Pieces of the collection are acquired through donations, purchases, and archeological acquisition. The collections are insured; The collection is kept on site and cataloged by the staff of the museum. The collection storage room is climate controlled and maintained to ensure collection integrity. In accordance with the provisions of FASB Codification, the Foundation does not capitalize donated works of art or recognize them as revenues or gains. FASB Codification provides that such donations need not be recognized if they are added to collections that are held for public exhibition, education, or research in furtherance of public service rather than to financial gain; are protected, kept unencumbered, cared for, and preserved; and are subject to a policy that requires the proceeds from sales of collection items to be used to acquire other items for collections. Note 5 - Property and Equipment The following is a summary of property and equipment as of December 31, 2011: December 31, December 31, 2010 Additions Deletions 2011 Equipment $ 223,784 $ 94,276 $ (605) $ 317,455 Less: accumulated depreciation 121,721 25,410 (65) 147,066 $ 102,063 $ 68,866 $ (540) $ 170,389 9 Alutiiq Heritage Foundation Notes To Financial Statements December 31, 2011 Note 6 — Leases The Foundation has an agreement for museum space that expires November 17, 2015. The agreement requires rental payments of $1 per year and reimbursement of condominium association dues and utilities to Kodiak Area Native Association (KANA). Payments for facility space made to KANA totaled $69,534 for the year ended December 31, 2011. The Foundation has an operating lease for a copier. The 60 month lease calls for monthly payments of $277 through December 2016. Note 7 — Noncash Investing and Financing Computer hardware and software were donated to the Foundation and capitalized in the amount of $20,835 Note 8 — Subsequent Events Management has evaluated subsequent events through month xx, 2012, the date on which the financial statements were available to be issued. 10 Alutiiq Heritage Foundation Letter to the Board of Directors Year Ended December 31, 2011 ACCOUNTING &; FORENSIC SERVICES, P.C. it ry ,,, «¢;:�.... ». _r „is t.?„_. c- �.'{:d:.. ..u�un -,a. ,.vf•.:u',�.'«',.,:.w'r�v rn -. t o: -.^'n rey _ s v7 m� N ..‘,) July 23, 2012 To the Board of Directors Alutiiq Heritage Foundation I have audited the financial statements of Alutiiq Heritage Foundation for the year ending December 31, 2011, and have issued my report thereon dated July 23, 2012. Professional standards require that I provide you with information about my responsibilities under generally accepted auditing standards, as well as certain information related to the planned scope and timing of my audit. I have communicated such information in my engagement letter to you dated January 17, 2012. Professional standards also require that I communicate to you the following information related to my audit. Significant Audit Findings Qualitative Aspects of Accounting Practice Management is responsible for the selection and use of appropriate accounting policies. The significant accounting policies used by Alutiiq Heritage Foundation are described in Note 1 and Note 4 to the financial statements. No new accounting policies were adopted and the application of existing policies was not changed during the year ended December 31, 2011. We noted no transactions entered into by the Organization during the year for which there is a lack of authoritative guidance or consensus. All significant transactions have been recognized in the financial statements in the proper period. Difficulties Encountered in Performing the Audit I encountered no significant difficulties in dealing with management in performing and completing my audit. Corrected and Uncorrected Misstatements Professional standards require that I accumulate all known and likely misstatements identified during the audit, other than those that are trivial, and communicate them to the appropriate level of management. Management has corrected all such misstatements. Material adjusting entries as result of audit procedures related to the capitalization of equipment and furnishings. Disagreements with Management For purposes of this letter, professional standards define a disagreement with management as a financial accounting, reporting, or auditing matter, whether or not resolved to our satisfaction, that could be significant to the financial statements or the auditor's report. No such disagreements arose during the course of my audit. Management Representations I have requested certain representations from management that are included in the management representation letter dated July 23, 2012. 626 Cordova Street, Suite 103, Anchorage, Alaska 99501 Phone 907 -334 -9501 I Fax 907- 334 -9502 William J. Schmid, CPA (cell 907-317-26111 Susan M. Spyker, CPA, CYA, CPrA (cell 907 - 351 - 3745) 1 1 ro . ai=' nrni:. G1 a .a rat rarr .- q , .., 7r ::. r�k:.... s. £F..:.: ".-^ dW::.;.. . j y Management Consultations with Other Independent Accountants In some cases, management may decide to consult with other accountants about auditing and accounting matters, similar to obtaining a "second opinion" on certain situations. If a consultation involves application of an accounting principle to the Organization's financial statements or a determination of the type of auditor's opinion that may be expressed on those statements, our professional standards require the consulting accountant to check with us to determine that the consultant has all the relevant facts. To my knowledge, there were no such consultations with other accountants. Other Audit Findings or Issues I generally discuss a variety of matters, including the application of accounting principles and auditing standards, with management each year prior to retention as the Organization's auditors. However, these discussions occurred in the normal course of our professional relationship and our responses were not a condition to my retention. This information is intended solely for the use of the board of directors and management of Alutiiq Heritage Foundation and is not intended to be and should not be used by anyone other than these specified parties. Very truly yours, (: 626 Cordova Street, Suite 103, Anchorage, Alaska 99501 Phone 907. 334 -9501 Fax 907 - 334.9502 William i. Schmid, CPA (cell 907- 317 -2611) Susan M. Spyker, CPA, CVA, CFFA ice 907- 351 -3745) Nova Javier From: Janet Buckingham <janet ©kodiak.org> Sent: Wednesday, February 13, 2013 2:32 PM To: Nova Javier Subject: Request to be on Borough Assembly Agenda Dear Nova: I am requesting to be placed on the work session agenda for February 28 (first choice) or March 14 (second choice) in order to present our funding request for the 2014 Budget. We have been attentive to the changes occurring within the borough funding model and are aware that organizations other than those charged with tourism marketing and development are likely to be funded from the bed tax revenue line item. My board of directors is very concerned about this trend. They have asked that I make a presentation to the borough assembly regarding the work done by Discover Kodiak and explain the real economic value of destination marketing to the Kodiak Island Borough. We will be asking for a substantial increase in funding this year because of a) special projects and b) increased cost of doing business and c) the need for expanded international marketing. I believe there is the potential to forward fund at least one of the special projects from the bed tax surplus available in 2012 -13 and know this is a consideration that should occur sooner rather than later. In meeting with borough assembly members, I was advised to seek a place on the agenda no later than early March. I appreciate your consideration. Respectfully, Jcutet Janet Buckingham Executive Director Discover Kodiak (907) 486-4782 janet@kodiak.org Follow us at: http: / /www.facebook.com /kodiakalaska Also follow us on twitter.com by searching for kodiakalaska. 1 02- 13- 13;01:48PM, # 1/ 1 -1, iS d ._ 1 . f 1 L ■ FEB 1 3 2O _M; KODIAK ISLAND BOROUGH -- ` AGENDA ITEM REQUEST FORM i z / a Or .42 Desired date for the item to appear on an Assembly agenda: /rata. /// Name: 1'3 uC_kift9} OL&.Or IN, 60(J— KOD/ ,1(< Address: I00 Ait.AR /&t JAy IVojr4K, AK Phone it: 6'4:71 Cell #: & v 9 / - 0 ICod a-k -or; Please state the item you wish to have placed on the agenda and submit any applicable documents with his form. 0/q t id with (Q alb �f ef- h n "lave, plucag zwatze_,251e 2 Please state the desired action of the Assembly: eeili ha dge, tg L ) t of- , , Do you wish to present this to the Assembly? X Yes No Presentations are normally limited to 15 minutes. If more time is desired, please state how many minutes is requested: Do you need to have access to equipment for this presentation such as a computer, projector, DVD player? If so, please state the equipment needed below: Please see additional information on the back of this form. KODIAK ISLAND BOROUGH AGENDA ITEM REQUEST FORM The Assembly meets on the first and third Thursdays of each month for their regular meetings and they normally meet a week before in work sessions before the regular meetings. If you have a specific topic that you would like the Borough Assembly to discuss at a future work session /meeting, OR if you wish to make a presentation to the Assembly, please complete this form and submit it to the Borough Clerk's Office. The item will possibly be scheduled for a future meeting or forwarded to Borough Staff for appropriate action. Please return this form to: Nova M. Javier, MMC, Borough Clerk Kodiak Island Borough 710 Mill Bay Road, Kodiak, AK 99615 Email: niavier Phone: (907) 486 -9310 Fax: (907) 486 -9391 For Staff Use Only: l Received by the Clerk's Office on: Oat i I go 0, Distributed to the Manager /Assembly on: n(/`i 1, l dp( Discussed at the agenda setting on: Approved for agenda item on: Work session date: Regular meeting date: Informed requestor on: Notes: ` o 1 J I,,[CIO:1. y ceq a 5 3 ,. zv t- r ALAS ' AMEr February 28, 2013 Bud Cassidy, Borough Manager Kodiak Island Borough 710 Mill Bay Kodiak, AK 99615 Dear Manager Cassidy: Through the ongoing assistance of the Kodiak Island Borough, Discover Kodiak continues to serve as the economic development contractor for tourism marketing in Kodiak. We develop and maintain marketing programs that benefit the Kodiak Island Borough and its businesses and aid in the economic growth and diversity of the KIB. On behalf of the KICVB Board of Directors and members, we respectfully request $100,000 for FY 2014. However, given the surplus in the existing bed tax fund, we request that the Borough consider forward funding a portion of our request from the FY 2013 fund. Attached you will find a detailed breakdown of our request. The Discover Kodiak board of directors has met multiple times and discussed the organization's role in the economic engine of the Kodiak Island Borough. As we bring visitors into Kodiak, we bring new money into Kodiak. The work we do is not only important, it is a cornerstone of the economy. Using state formulas, it is estimated that the tourism industry generates approximately 29 million dollars of spending in the Kodiak Island Borough each year. It makes good sense for the borough to reinvest the majority of bed tax dollars back into the industry that helps generate them. The surplus of bed tax funds speaks in large part to our success in promoting Kodiak and helping to fill beds. The surplus also exists because the CVB has been extremely conservative in our requests for funding and /or have been denied funding increases in the past. We have reached a point, however, when we cannot continue to grow the tourism economy of Kodiak without more funds. We work very hard to keep our costs down and we are in a healthy fmancial position, but continue to need government funding to achieve the marketing and economic development services requested by the Kodiak Island Borough. Thank you for your continued faith in us as the tourism arm of economic development. We hope you recognize the importance of our marketing efforts and the results they are having in the community. tt erely, • Jane :uckingham -cutive Director Discover Kodiak 100 Marine Way, Kodiak, Alaska 99615 907- 486 -4782 FAX 907- 486 -6545 http: / /www.kodiak.org e-mail: visit @kodiak.org aa- DESTINATION MARKETING & TOURISM DEVELOPMENT PROGRAM AGREEMENT THIS AGREEMENT is entered into by and between the Kodiak Island Borough, Alaska, (Borough) and the Kodiak Island Convention and Visitors Bureau (contractor) for the purpose of setting forth the terms and conditions pursuant to which the contractor shall be contracted to provide destination marketing and tourism development activities for the Kodiak Island Borough. Section 1. INTENT OF AGREEMENT. The contractor is hereby contracted to provide a Marketing Committee (KICVB Board of Directors) and one full time equivalent to focus on destination marketing and tourism development in the Kodiak Island Borough. Section 2. SCOPE OF WORK. The contractor will work with the Marketing Committee to accomplish the following tasks identified in the document, such as: a. Produce collateral marketing materials, including the Explore Kodiak Visitor Guide b. Continue to provide information about Kodiak region to the traveling public c. Maintain and staff the Kodiak Visitor Center d. Keep the Borough Assembly and community at large informed as to the results of marketing efforts and the state of the local tourism industry e. Work with the Alaska Travel Industry Association and other statewide marketing organizations to ensure Kodiak is represented in their ongoing national and international marketing programs f Continue work with the communities in the Kodiak Island Borough to determine the role tourism does and can play in the community economies g. Work with the Kodiak Chamber of Commerce to transform the visitor industry into a significant component of the Kodiak region's economy h. Continue development of the kodiak.org website to improve its usability and visibility to visitors, potential businesses and residents i. Work with Kodiak College, the Kodiak Island Borough School District, Kodiak Area Native organizations, and other organizations to encourage entrepreneurship and assist small business development in the visitor industry j. Develop a travel press kit to be available on the kodiak.org website, develop a distribution plan for the kit to various travel media k. Explore new employment and business opportunities related to the Kodiak visitor industry 1. Continue work with the airline industry and the Alaska Marine Highway System to maintain and improve access to the Kodiak region m. Work with the Kodiak Branding and Marketing Committee to develop cooperative marketing opportunities in culinary tourism n. Continue participation in the Comprehensive Economic Development Strategy committee to foster an understanding of the tourism industry and opportunities and challenges facing the industry A minimum of four Marketing Committee meetings will be scheduled during the term of this Agreement for the purpose of maintaining committee input and guiding the efforts of the contractor. A report of all marketing activities of the contractor will be submitted to the Borough Manager on a quarterly basis. An annual report to the Kodiak Island Borough Assembly shall be presented each spring. Section 3. TERM. This agreement will remain in effect July 1, 2012 through June 30, 2013, unless earlier terminated. Either party shall have the right to terminate the agreement without penalty upon one month's written notice to the other. Section 4. COMPENSATION. As compensation for all services rendered under this agreement, contractor shall be paid $65,000.00 by the Kodiak Island Borough. Said compensation shall be paid in equal installments of $16,250.00 on the second Friday of July and October 2012, and January and April 2013. ,�,� IN WITNESS WHREROF the parties have executed this Agreement on this !f • oay of , 4d KODIAK ISLAND BOROUGH KODIAK ISLAND CONVENTION & VISITORS BUREAU • Charles E. Cassidy Jr.,� ane Buckingham, KICVB Direg or Administrative Official Attest: `svAND e0 0 O i t. o ^' I v a . Javie MC, Borough Clerk Y I 9 � 14 SKA * �°� e it 1 ■ • ALASKA r ANEW" Board of Directors Jim Rippey, President (Russian River Roadhouse) Bob Stanford, Vice President (Island Air Service) Susan Johnson, Treasurer (Best Western Kodiak Inn and Harbor Convention Center) Jan Chatto /Darlene Turner, Co- Secretaries (Pearson Cove B &B /Smiling Bear B &B) Chris Fiala, Kodiak Island Charters Gus Gustafson, Kodiak Russian River Lodge Charles Bona, Era Alaska Marya Halvorsen, Alutiiq Museum Staff: Janet Buckingham, Executive Director Erin -Anne Brittain, Member Services & Payables Manager Chastity Starrett, Visitor Services Historical Overview: The Kodiak Island Convention & Visitors Bureau was incorporated as a 501 (c) 6 in 1985. The City of Kodiak allocated bed tax the same year. (COK Code 3.08.025) In 1996 the Kodiak Island Borough passed an ordinance introducing a bed tax to be used solely for the purpose of tourism development, enhancement and beautification.(KIB Code 3.55.010) Purpose: The purpose of the Kodiak Island Convention & Visitors Bureau, dba Discover Kodiak, shall be to promote sustainable development of the tourism industry throughout the Kodiak Island Borough, thereby increasing economic opportunities, jobs and local tax revenues. Discover Kodiak encourages travel by the public to and through the Kodiak Island Borough and maintains a continuing interest in the well -being of visitors to the area. Accomplishments in FY 2013 • New web site launching spring 2013 • Rebranding of the CVB to Discover Kodiak...Alaska Untamed • New visitor guide • New mini - brochure • Increased traffic to www.kodiak.org • Social Media o Facebook: Continue to be the statewide leader in Facebook fans o Twitter o Pinterest and You Tube • Sold out fundraiser four years; meet or exceed fundraising expectations • Increased retail store revenues as a result of new product development • Membership drive resulted in 14 new members within a 3 -month period • Provided scholarships to the KUBS Commercial Bear Viewing Course at Kodiak College • Staff attended KUBS bear viewing course at Kodiak College Proposed Budget Breakdown FY14 FY13 Public Funding $190,000 $155,000 Earned Revenues $152,000 $140,000 TOTAL: $342,000 $295,000 Program Expenses $151,700 $120,600 Operating Expenses $190,300 $185,500 TOTAL: $342,000 $306,100 Known arbitrary increases in operating /miscellaneous expenses: Salaries $2,000.00 (1.5 %) Contract fees for accounting services: $1,000.00 (8.3 %) Printing /shipping (VG production) $1,450.00 (5% estimate) Postage $ 250.00 (2.57 %) Website services (search engine optimization, analytics reporting) $6,000.00 (previously unbudgeted /unavailable service) TOTAL nondiscretionary increases: $10,700.00 Marketing Program Increases Discover Kodiak Board of Directors and staff have long wanted to reach out in a more aggressive way to international markets. These markets are visiting Alaska and while Kodiak has seen small increases in independent international travel to Kodiak, we are largely missing out on our share of international clients. International visitors stay longer and spend more money than domestic travelers. We are proposing to target German speaking Europe as it is currently the largest market for Alaska. ITB Berlin is the largest travel trade and consumer show in the world. It would be cost prohibitive to purchase our own booth at this show, but as a community partner with ATIA, the Department of Commerce, Community and Economic Development provides the option to booth share in the state booth. This brings down our costs dramatically. The second show proposed by the Board of Directors is a travel show coordinated through Icelandair. The airline recently began service direct to Anchorage. Reykjavik, Iceland, is a major hub for European travelers and is very invested in Alaska. They have developed an affordable venue for Alaskans to travel to Reykjavik and meet with travel agents and travel trade representatives who promote travel to Alaska throughout Europe. Again, this opportunity is only possible because of our partnership with the ATIA and the DCCED. International Trade & Consumer (2) Booth fees: $3,750 Travel Costs: $5,750 VG Shipping $ 800 International Advertising German Language (web & print) $ 2,000 Targeted Domestic Advertising (increased print ads in steady performers) $ 6,000 Program TOTAL: $18,300 Projects /Services Community Map Mapmaking (KIB) $ 600 Graphics $ 1,400 Printing (10,000) $ 4,000 including 1,000 to KIB (no charge) Project TOTAL: $ 6,000 Total nondiscretionary expense increase: $10,700 Total program expense increase: $18,300 Community map increase: $ 6,000 TOTAL INCREASE EXPENSES: $35,000 Forward fund community map project from current year bed tax surplus $ 6,000 Forward fund international programs from current year bed tax surplus $ 18,300 TOTAL Request for Forward Funding: $24,300 TOTAL Request for 2014 Budget: $75,700 t * °9p, Kodiak Islandforoagh i ! , ` Assessing Department 4 t i s . i , , = 710 Mill Bay Road • Kodiak, Alaska 99615 4 t • , Phone (907) 486 -9353. Fax (907) 486 -9395 This 2013 assessment notice of value reflects the final phase of the road - system property re- inspection and reappraisal and 80 -90% of the remote property re- inspection and reappraisal. Now that all road - system properties have been inspected and entered into the Borough's computer assisted mass appraisal (CAMA) software, adjustments have been made to reflect recent market fluctuations and adjustments have been made to some property groups whose market values were not accurately reflected in the 2010 to 2012 reappraisal. Most notable of these groups is smaller homes which have been increasing in value at a rate faster than the rest of the market. State law requires that "The assessor shall assess property at its full and true value as of January 1 of the assessment year....The full and true value is the estimated price that the property would bring in an open market and under the then prevailing market conditions in a sale between a willing seller and a willing buyer both conversant with the property and with prevailing general price levels." (Alaska Statute 29.45.110) With the annual required reappraisal, property assessments can fluctuate from year to year, either upward or downward. However, the Kodiak market is fairly stable and this fluctuation should be minor except in cases where errors in property assessments are discovered. State law also requires that a systematic reevaluation of taxable real and personal property over the shortest period of time practicable be established by the borough. (AS 29.45.150) This means that the assessing department shall physically re- inspect all properties on a regular basis for reappraisal. The Kodiak Island Borough has determined that all road system properties shall be inspected on a three year cycle and all remote properties on a five year cycle. The purpose of the annual updates and periodic re- inspections is to assure equity in property tax administration with each property owner paying taxes on a fair and equitable basis. KODIAK ISLAND BOROUGH s), n7- WORK SESSION Work Session of: 67 , ,a70, ,0f, Please PRINT your name Please PRINT yo . 5 ,-. \. va 'la c:D -- 1 - ; Si< S\\\S\\‘7 a Ti- 61 A L,rl r) A? heiiii 1 5 r .41 7,11) _fit. 2). itri alcie-;, a _ r %,\\W a6 R344 i?(A /2 \ ----..\s\> n Ly, LatAr 11� /YORKS, ( V i l) 6616M 0/1daeyr t v ,c \ V ) (440 VoWiirbeSth k i\04 - \ ("No, ) C t ---<---') \V - / rj \\ /- ' \ � 4);:l �:g ; S h I. a ic:1 V \k://