Assemblyman Dan Henry has pleaded guilty to four misdemeanor counts of federal tax charges for failing to file timely income tax returns for his business, The Skagway Fish Company. Henry agreed to pay $600,064 in restitution to the Internal Revenue Service, not including penalties or interest. The agreement also recommended no more than 24 months of imprisonment and no less than eight.

According to the plea agreement, which was signed last week and submitted to the federal court on Tuesday, Henry knowingly failed to file returns from 2004 to 2012. From at least 2008 to 2012,  Henry and an immediate family member, who acted without criminal intent, conducted deposits and purchased bank checks between $9,000 and $9,900 for the purpose of evading the reporting requirements. From 2009 to 2012, the restaurant earned gross income between $529,267 and $665,820.

Henry also concealed his income on Alaska Public Offices Commission financial disclosure statements from 2010 to 2013, wherein he indicated that he had received no income over $1,000 from self-employment. APOC did not respond for comment.

The plea agreement states that in failing to file his returns, Henry admits to intentionally violating the known legal duty to file a return, and not through ignorance, mistake, accident, or good faith belief that he was not required to file.

Henry submitted his plea to the courts in Juneau on Tuesday, with sentencing set to occur in May. But according to Assistant U.S. District Attorney Jack Schmidt, it will likely be held off until mid-summer, as Henry has a business to run.

Though the recommendations confine the U.S. Attorney’s office and Henry to a sentence of no more than 24 months incarceration and no less than eight, final sentencing is up to U.S. District Court Judge Timothy Burgess, who could decide on a longer term or simply probation.

Sentencing largely depends on the defendant’s previous criminal history, the nature of the offense, and his personal background.

Henry’s attorney Robert Bundy said Henry was released without restrictions and was allowed to keep his passport, should he need to travel to Whitehorse, YT for supplies.

“It’s a complete release,” Bundy said.

[quote_right]“What he is charged with is not a felony. It’s nothing that precludes him from being able to serve,” Schaefer said. “This is not anything to do with the municipality.” [/quote_right]

Henry has served on Skagway’s assembly since 1998 and also serves as Finance Committee chair.

According to Skagway Municipal code, assembly members can be unseated for a variety of reasons, including conviction of a felony or of an offense involving a violation of the oath of office, as well as conviction of a felony or misdemeanor as described in the Election Offenses and Corrupt Practices, which states the election of a candidate to the state legislature or to municipal office who knowingly commits a corrupt practice or whose campaign treasurer or deputy campaign treasurer knowingly commits a corrupt practice is voidable under this section. According to municipal code, two-thirds of the members of the assembly must agree on the expulsion.

Henry was reached by phone on Tuesday, but declined to make comment at the behest of his attorney.

The borough assembly was made aware of the charges immediately before its meeting on Feb. 4 when the story broke on KTUU, but the issue was not addressed. Mayor Mark Schaefer said assembly members barely had any time to discuss the news before the meeting was in session.

As for Henry’s position at the table, the future remains uncertain.

“What he is charged with is not a felony. It’s nothing that precludes him from being able to serve,” Schaefer said. “This is not anything to do with the municipality.”

Schaefer couldn’t say much more and directed further questions to Skagway Borough Attorney Bob Blasco, who could not be reached for comment. Schaefer did say that he’s not sure what the charges mean for Henry’s future on the assembly.

“We’ll just wait to see what happens, and then we’ll take the next step,” he said.

Henry has lived in Skagway since 1989 and purchased the Skagway Fish Co. in the late 90s and owned the Corner Café until it closed in the mid-2000s. He is a long-serving member of the Elks and is in charge of organizing events like Flag Day and the Veteran’s Day dinner. While at the table, Henry has most recently been a negotiator for the municipality in regard to the Tidelands lease between the White Pass and Yukon Route railroad and MOS. His term expires in October 2017.