Transfers from Bartlett hospital and Docks & Harbors funds to CBJ general fund

Juneau’s City Hall on Friday, Aug. 14, 2026. (Mark Sabbatini / Juneau Independent)

By Bob Bartholomew and Max Mertz

Because of a projected a loss of revenue from voter-approved initiatives to reduce or cap sales and property tax revenue, this year the Assembly evaluated numerous options to find other sources of funding, including what we believe to be illegal transfers of money from two of the city’s “enterprise funds” to cover general government operating expenses.  These transfers should be reversed and future transfers discontinued.  

Four enterprise funds have been established by the City Charter: Bartlett Hospital; Juneau Airport;  Docks & Harbors; and Water and Sewer utilities. These funds are intended to account for all activities of these entities and to be self-supporting from their own revenues and fees — basically operated like a private business. 

CBJ’s Charter Section 9.16. - Enterprise Funds states “Revenues from an enterprise, whether established before or after July 1, 1970, shall be first used for debt retirement, construction, acquisition, operation, maintenance, repair, and capital improvement of the enterprise.”

This charter section provides legal and budgetary guardrails to prohibit the Assembly from spending these enterprise fund balances for purposes unrelated to the enterprises themselves.  To our knowledge, the CBJ Assembly and management have always been faithful to the charter requirement, never transferring money from the funds for other purposes – until this year.  

Breaching the charter and past practices this spring, the Assembly transferred $247,000 from Bartlett to the general fund to support Gastineau Human Services (GHS)’s chemical dependency services. This transfer represented over 13% of Bartlett’s budgeted operating income and has potentially significant repercussions to Bartlett’s ability to provide its key mission functions over time. While we fully support the GHS’s chemical dependency programs, taking money from Bartlett Hospital to fund these programs is the wrong approach.

Bartlett has significant unfunded needs for construction, maintenance, repair and capital improvements. It also has outstanding debt. The board and management are working on an update to its facility plan to make repairs and improvements needed to the existing campus which are currently unfunded. One consequence of the assembly’s action is immediately evident.   

 A couple years ago, Bartlett was struggling to fully fund its operations and was asked to oversee certain peripheral social service programs on the verge of collapse, in particular maintenance of hospice and homecare (HHC) services for the community. To help maintain those services, the Assembly committed $200,000 to BRH for five years over which time Bartlett would work to stabilize the inherited financial deficits HHC had when another nonprofit agency discontinued providing these services. The $247,000 transfer to GHS had the effect of cancelling CBJ’s support for HHC for 2027, leaving Bartlett to scramble to maintain these community priority services. 

This spring, the Assembly also made a similar illegal transfer from the Dock Enterprise Fund totaling  $1,886,200 for fiscal year 2027. The CBJ transferred the funds to the general fund and roads fund. The justification provided was that there are impacts from the cruise industry affecting roads. If this is the case, the Assembly could have this need compete with other needs for use of the over $20 million in Marine Passenger Fees collected each year.  This transfer, like Bartlett’s, is unprecedented, and ignores large upcoming capital projects in need of funding.

Transfers like these have the effect of weakening the funds and starting down a slippery path that could make their long-term viability less certain. They also undermine funds’ management, including the volunteer community members who serve on their boards. We encourage the Assembly to revoke these transfers and comply with the clear intent, and decades of past practice, of CBJ Charter provisions going forward.

• Bob Bartholomew, retired from a career as a CPA and 28 years in various state and local government senior financial management positions (including seven years as CBJ finance director). Max Mertz, CPA, audited CBJ’s finances for over two decades, and has a professional background including governmental accounting, budgeting and auditing.  He serves on the Bartlett board as its Finance Committee chair, but these comments are his own and not in his official capacity.