KETCHIKAN — A tourism business owner will pay $20,000 in an agreement with the Ketchikan Gateway Borough to settle a tax dispute.
Seamus Brodie, owner of the Alaska Gem Store and its earlier incarnation, the Ketchikan Gem Museum, also will have to pay taxes monthly through the end of the tourist season, according to the agreement.
The borough’s financial officials had earlier estimated he owed $27,000 in back taxes, but said the settlement will cover the $5,000 it spent trying to recover the money, the Ketchikan Daily News reported Thursday. The remainder will be split by the city and the borough.
It was difficult to determine the exact amount of back taxes owed since Brodie never supplied documentation to the borough, said Finance Director Mike Houts.
Borough Manager Dan Bockhorst was happy with the settlement. “We came up with a very fair settlement as far as the borough is concerned,” he said. “It was not something that was easy in negotiation.”
Calls to the Alaska Gem Store seeking comments went unanswered Thursday.
The city has dropped its request for a preliminary injunction against Brodie. Had it been approved, Brodie would not have been able to conduct any business in the borough.
Bockhorst said the city will reinstate the case if Brodie doesn’t follow through.
The assembly in March expanded the borough’s powers to collect back taxes, including shutting down a business.
“We’re not heavy-handed, but we’re not going to tolerate flagrant violations of our tax code,” Bockhorst said.
The borough could even seek to have a violator jailed if they intentionally or recklessly refuse to cooperate with the borough’s attempts to collect taxes, a measure the borough hasn’t yet sought.
Houts said about 4 percent of businesses in the borough, which handles tax collection duties for the cities of Ketchikan and Saxman, don’t comply with the sales tax code.