City and Borough of Juneau

Finance Committee Meeting

Wednesday March 14, 2007, 5:00 p.m.

Assembly Chambers


I.   Call to Order

II.   Roll Call

 III. Approval of Minutes

December 13, 2006


IV. Annual Financial Reports

Enclosed with the packet are the City and Borough of Juneau’s FY06 general governmental financial reports.  These reports are produced as part of the annual audit process.  These reports were prepared by staff and our Auditors, Elgee Rehfeld Mertz, LLC.  The reports include the following –


The Letter to the Assembly and the Internal Control and Operating Comments reports were prepared by our Auditors.  The Comprehensive Annual Finance Report was prepared by the Finance Department staff.  The State Financial Assistance and the Expenditures of Federal Awards Report were prepared as a joint effort.  Staff prepared the single audit financial data and the Auditors prepared the opinions and findings information.

These reports contain a significant amount of detailed financial information about the CBJ’s operations.  The following is a brief overview each report-



Mr. Max Mertz, of Elgee, Rehfeld and Mertz, the audit firm conducting the City and Borough’s annual audit will present the Comprehensive Annual Financial Report (CAFR) and accompanying reports, provide an overview of the process and be read to respond to questions.


The firm of Elgee, Rehfeld and Mertz also prepare a separate set of financial reports for the School District.  These reports have been previously submitted to the School Board.


V. Juneau Arts and Humanities Council (JAHC)

During the previous budget process, a question was raised regarding the ability of other or new groups to obtain arts and humanities funding from the CBJ.  In responding to this concern, the Finance Committee requested that the Juneau Arts and Humanities Council (JAHC) develop a process to allocate CBJ art related grant funds.  The JAHC has been reviewing grant allocation options.  Included in your packet is information on FY07 and FY08 project funding requests, JAHC’s FY07 Revised Budget and grant application information.  Nancy DeCherney, JAHC Executive Director, will present information on the new procedures being used to solicit and evaluate grant applications.


VI. Sales Tax Exemption Request – Education

The Sales Tax Appeals Board recommended a potential code change to exempt a K to 12 educational related businesses that does not currently qualify for exemption.  This recommendation came out of a denied sales tax appeal.  Normally this type of business would qualify for exemption under the non profit 501(c)(3) or 501(4) section.  Additional information is contained in the packet.


VII. Sales Tax Exemption Request – Related Party Rentals of Personal Property

This is a request by vendor to expand the Related Party Real Property exemption.  Currently the code does provide an exemption for related party leases of real property.  The code does not contain a provision for the lease of personal property.  The request is to expand the sales tax code to include an exemption for the lease of personal property between related parties.  Additional information is contained in the packet.


VIII. Sales Tax Exemption Request – Payday Lenders

The Sales Tax Appeals Board recommended that the following item be brought forward to the Finance Committee for review.  This recommendation came from a denied sales tax appeal.  This recommendation deals with the exemption for Banks, Savings & Loan Associations, Credit Unions and Investment Bank exemptions.  The Sales Tax Appeals Board recommended the CBJ consider expanding the current banking sales tax exemption to include payday lenders.  Additional information is contained in the packet.

IX. Sales Tax Exemption Request – Out of Borough Sales

This recommendation deals with the exemption for orders received from outside the borough where the item is shipped outside the borough as evidences by postal or shipping documents.  We have a merchant who prepares and sends outs a newsletter electronically.  The currently sales tax code provisions do not address the delivery of items electronically.  Staff is recommending the code be modified to allow for the recognition of items shipped electronically out of the borough to be exempt.  Additional information is contained in the packet.


X.  Special Election Funding –

The Assembly has decided to move a head with a special election on June 12.  When discussing the special election the Committee of the Whole requested that the City Manager provide information on the estimated cost and sources of funding for the special election.  The City Manager will present a funding recommendation to the Finance Committee.


XI.  Information Item

Finance Committee FY08 Budget Review Schedule


XII. Adjournment