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SSSB 20: "An Act establishing the Alaska municipal basic services program, relating to certain programs of state aid to municipalities and recipients in the unorganized borough; and providing for an effective date."

00SPONSOR SUBSTITUTE FOR SENATE BILL NO. 20 01 "An Act establishing the Alaska municipal basic services program, relating to 02 certain programs of state aid to municipalities and recipients in the unorganized 03 borough; and providing for an effective date." 04 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 05 * Section 1. AS 29.20.640(b) is amended to read: 06  (b) Compliance with the provisions of this section is a prerequisite to receipt 07 of an entitlement under the Alaska basic municipal services program under 08 AS 29.60.011 - 29.60.330 [MUNICIPAL TAX RESOURCE EQUALIZATION 09 ASSISTANCE UNDER AS 29.60.010 - 29.60.080 AND STATE AID FOR 10 MISCELLANEOUS MUNICIPAL SERVICES UNDER AS 29.60.100 - 29.60.180]. 11 If a municipality does not comply with this section, the department shall withhold the 12 entitlement [ALLOCATIONS] until the required reports are filed. 13 * Sec. 2. AS 29.45.020 is amended to read: 14  Sec. 29.45.020. TAXPAYER NOTICE. (a) If a municipality levies and

01 collects property taxes, the governing body shall provide the following notice: 02 "NOTICE TO TAXPAYER 03 For the current fiscal year the (city)(borough) has been allocated the following amount 04 of state aid for school and municipal purposes under the applicable financial assistance 05 Acts: 06 PUBLIC SCHOOL FOUNDATION PROGRAM 07 ASSISTANCE (AS 14.17) $ 08 STATE AID FOR RETIREMENT OF SCHOOL 09  CONSTRUCTION DEBT (AS 14.11.100) $ 10 ALASKA MUNICIPAL BASIC SERVICES 11 (AS 29.60.011 - 29.60.330) 12 [MUNICIPAL TAX RESOURCE EQUALIZATION 13  ASSISTANCE (AS 29.60.010 - 29.60.080) $ 14 STATE AID FOR MISCELLANEOUS MUNICIPAL 15  SERVICES (AS 29.60.100 - 29.60.180)] $ 16 TOTAL AID $ 17 The millage equivalent of this state aid, based on the dollar value of a mill in the 18 municipality during the current assessment year and for the preceding assessment year, 19 is: 20 MILLAGE EQUIVALENT 21 PREVIOUS YEAR THIS YEAR 22 PUBLIC SCHOOL FOUNDATION 23  PROGRAM ASSISTANCE . . . . MILLS . . . . MILLS 24 STATE AID FOR RETIREMENT 25   OF SCHOOL CONSTRUCTION 26  DEBT . . . .MILLS . . . .MILLS 27 ALASKA MUNICIPAL BASIC SERVICES 28 [MUNICIPAL TAX RESOURCE 29  EQUALIZATION ASSISTANCE . . . .MILLS . . . .MILLS 30 STATE AID FOR MISCELLANEOUS 31 MUNICIPAL SERVICES] . . . .MILLS . . . . MILLS

01 TOTAL MILLAGE 02 EQUIVALENT . . . .MILLS . . . .MILLS" 03 Notice shall be provided 04  (1) by furnishing a copy of the notice with tax statements mailed for 05 the fiscal year for which aid is received; or 06  (2) by publishing in a newspaper of general circulation in the 07 municipality a copy of the notice once each week for a period of three successive 08 weeks, with publication to occur not later than 45 days after the final adoption of the 09 municipality's budget. 10  (b) Compliance with the provisions of this section is a prerequisite to receipt 11 of an entitlement under the Alaska municipal basic services program under 12 AS 29.60.011 - 29.60.330 [MUNICIPAL TAX RESOURCE EQUALIZATION 13 ASSISTANCE UNDER AS 29.60.010 - 29.60.080 AND STATE AID FOR 14 MISCELLANEOUS MUNICIPAL SERVICES UNDER AS 29.60.100 - 29.60.180]. 15 The department shall withhold annual allocations under those sections until municipal 16 officials demonstrate that the requirements of this section have been met. 17 * Sec. 3. AS 29.45.660(b) is amended to read: 18  (b) Compliance with the provisions of this section is a prerequisite to receipt 19 of an entitlement under the Alaska municipal basic services program under 20 AS 29.60.011 - 29.60.330 [MUNICIPAL TAX RESOURCE EQUALIZATION 21 ASSISTANCE UNDER AS 29.60.010 - 29.60.080 AND STATE AID FOR 22 MISCELLANEOUS MUNICIPAL SERVICES UNDER AS 29.60.100 - 29.60.180]. 23 The department shall withhold annual allocations under those sections until municipal 24 officials demonstrate that the requirements of this section have been met. 25 * Sec. 4. AS 29.60 is amended by adding new sections to read: 26  Sec. 29.60.011. ALASKA MUNICIPAL BASIC SERVICES PROGRAM. 27 The Alaska municipal basic services program is established in the department. The 28 department shall deposit appropriations for the program in the municipal basic services 29 account. During each state fiscal year the department shall compute entitlements under 30 AS 29.60.013 - 29.60.330 for payment the following state fiscal year based upon 31 appropriations for the program. Money in the account shall be fully distributed by the

01 department each year for entitlements under the program. 02  Sec. 29.60.013. ENTITLEMENTS FOR MUNICIPAL BASIC SERVICES.  (a) A municipality that provides 03 services within one of the municipal 04 basic service categories listed in (b)(1) - (7) of this section qualifies for a share 05 of the amount allocated to that category based upon the population, amount 06 expended on the services, and ability to pay for the services in each of the 07 taxing units in which the services are provided. The municipality's share for 08 each category is determined by applying the following formula to the taxing 09 units within which the services are provided: share = (P x E) R, where (1) 10 P = population of the taxing units; (2) E = the amount of local expenditures 11 in the municipal basic services category; and (3) R = one-tenth of one percent 12 of the full and true value of the assessed property in the taxing units; however, 13 the per capita property value used under this subsection may not be less than 14 30 percent nor more than 300 percent of the statewide average per capita full 15 and true assessed property value. 16  (b) The department shall reserve from appropriations for the Alaska municipal 17 basic services program amounts necessary to fully fund entitlements under 18 AS 29.60.130, 29.60.140, and 29.60.290. The balance shall be allocated among the 19 municipal basic services categories as follows: 20  (1) police - 17 percent; 21  (2) water and sewer - 8 percent; 22  (3) solid waste management - 5 percent; 23  (4) fire and emergency medical - 11 percent; 24  (5) assessment and taxation, finance, and land use planning - 19 25 percent; 26  (6) public schools for grades K - 12 - 20 percent; 27  (7) community services, including parks, recreation, cultural activities, 28 libraries, health and social - 4 percent; 29  (8) roads and ice roads - 12 percent; 30  (9) health facilities under AS 29.20.120 - 4 percent. 31  Sec. 29.60.015. DETERMINATION OF THE AMOUNT OF LOCAL

01 EXPENDITURES. (a) For purposes of AS 29.60.013(a), the amount of local 02 expenditures on municipal basic services is the amount of actual expenditures made 03 for all services and the maintenance and operation of all facilities included in the 04 particular municipal basic services category during the municipal fiscal year 05 immediately preceding the year in which the municipality's share of the money 06 allocated to that category is being computed. 07  (b) If water, sewer, or solid waste management services are provided by a 08 private business in a municipality and the municipality makes no expenditures for the 09 services, for purposes of AS 29.60.013(a), the municipality shall receive credit for a 10 local expenditure for that service. The amount of the credit is equal to the per capita 11 average cost of providing the service multiplied by the population of the municipality. 12  (c) For purposes of determining the amount of local expenditure for schools 13 under AS 29.60.013(b)(6), money received by a municipality under AS 41.15.180 may 14 not be included. 15 * Sec. 5. AS 29.60.020 is amended to read: 16  Sec. 29.60.020. DETERMINATION OF POPULATION. For purposes of 17 AS 29.60.011 - 29.60.330 [AS 29.60.010 - 29.60.080], the population of a taxing 18 unit shall be determined annually by the latest figures of the United States Bureau of 19 the Census or other population data that in the judgment of the department is reliable. 20 * Sec. 6. AS 29.60.030(d) is amended to read: 21  (d) The full and true assessed property value shall be determined by the 22 department in the manner provided for the computation of state aid to education under 23 AS 14.17.140. [WHEN THE DETERMINATION OF LOCALLY GENERATED 24 REVENUE INCLUDES REVENUE OF A UTILITY RECEIVED UNDER 25 AS 29.60.010(c)(1)(E), THE FULL AND TRUE ASSESSED PROPERTY VALUE 26 MUST INCLUDE THE COMPUTED ASSESSED VALUE OF THE UTILITY, 27 DETERMINED BY DIVIDING THE AMOUNT OF THE PAYMENT IN PLACE OF 28 TAXES MADE BY THE UTILITY BY THE MILLAGE RATE THAT WOULD 29 APPLY TO THE UTILITY IF THE UTILITY WERE SUBJECT TO LEVY AND 30 COLLECTION OF TAXES UNDER AS 29.45.] 31 * Sec. 7. AS 29.60.030(e) is amended to read:

01  (e) In addition to the computation for municipalities that levy and collect a 02 property tax, the department shall determine an estimated full and true assessed 03 property value under (d) of this section for 04  (1) each municipality that is a school district and that does not levy and 05 collect a property tax; 06  (2) each second class city with a population of 750 or more persons; 07 however, a computation is not required under this paragraph more often than once 08 during a period of three successive calendar years; and 09  (3) all other second class cities, by determining the average per capita 10 full and true assessed property value of all second class cities having a population of 11 less than 750 persons in which an assessment has been completed within the last 12 three calendar years by a municipality or the department [FOR WHICH A 13 DETERMINATION IS NOT MADE UNDER (1) OR (2) OF THIS SUBSECTION]. 14 * Sec. 8. AS 29.60.040 is amended to read: 15  Sec. 29.60.040. REPORTS. A payment of an [EQUALIZATION] entitlement 16 may not be made to a municipality under AS 29.60.011 - 29.60.330 [AS 29.60.010 - 17 29.60.080] until the municipality has submitted its certificate of local annual 18 municipal basic services expenditures [ESTIMATED REVENUE] and its financial 19 report to the department for the municipal fiscal year preceding the year in which the 20 department's computation of entitlements under the Alaska municipal basic 21 services program [DETERMINATION OF THE MILLAGE RATE EQUIVALENT] 22 is made [UNDER AS 29.60.030], together with the municipality's budget for the fiscal 23 year for which an entitlement is sought. The financial report must include a listing of 24 local annual municipal basic services expenditures for the appropriate taxing unit 25 [GENERAL REVENUE COLLECTED FROM TAXES LEVIED AND ASSESSED 26 AND ANY OTHER REVENUE] that, in the opinion of the municipal officials, is 27 eligible for inclusion in computations under AS 29.60.013 [OF THE LOCALLY 28 GENERATED REVENUE OF THE TAXING UNIT]. 29 * Sec. 9. AS 29.60.070(a) is amended to read: 30  (a) The department shall [MAY] adopt regulations necessary to implement 31 AS 29.60.011 - 29.60.330 [AS 29.60.010 - 29.60.080]. The regulations must include,

01 among other provisions, 02  (1) procedures and filing dates for submitting certification and financial 03 reports; 04  (2) procedures for obtaining information required to compute and 05 determine the municipality's entitlement [MILLAGE RATE EQUIVALENT]; [AND] 06  (3) procedures by which the department shall notify a municipality in 07 writing of the reasons for a proposed disallowance or adjustment of any factor bearing 08 upon the determination of the municipality's entitlement and by which the municipality 09 will be provided reasonable time in which to respond or to challenge the department's 10 determination; and 11  (4) classification of expenditures that qualify as local expenditures 12 for municipal basic services. 13 * Sec. 10. AS 29.60.070(b) is amended to read: 14  (b) The department shall make reasonable efforts to advise and assist 15 municipalities in collecting information and completing reports necessary for the 16 determination of entitlements under AS 29.60.011 - 29.60.330 [AS 29.60.010 - 17 29.60.080]. 18 * Sec. 11. AS 29.60.110 is amended by adding a new subsection to read: 19  (c) Only money allocated under AS 29.60.013(b)(8) to the municipal basic 20 services category for roads and ice roads may be used for entitlements under this 21 section. If the amount allocated to that category is insufficient to pay each entitlement 22 or if the amount exceeds that required to pay each entitlement, the amount available 23 shall be distributed pro rata among eligible municipalities. 24 * Sec. 12. AS 29.60.120(a) is amended to read: 25  (a) The department shall pay 26  (1) to a municipality that has the power to provide hospital facilities 27 and services and that exercises that power, $1,000 per bed for each bed actually used 28 for patient care, limited to the number of beds provided for in the construction design 29 of the hospital, or $250,000 a hospital for those hospitals with 10 or more beds, or 30 $50,000 a hospital for those hospitals with less than 10 beds, as the municipality may 31 elect; money received under this paragraph may be used only for hospitals and shall

01 be apportioned among qualifying hospitals as the municipality determines; 02  (2) on the basis set out in (1) of this subsection to a municipality for 03 a nonprofit hospital not operated by a municipality if the municipality first certifies to 04 the department that the nonprofit hospital is in compliance with all standards for 05 hospitals that have been adopted by the municipality; money may not be paid on 06 behalf of a nonprofit hospital without this certification; payments to the municipality 07 shall be transferred to the nonprofit hospital in accordance with the basis by which the 08 payment was generated by the hospital, and shall be applied to the annual cost of 09 operation and maintenance of the hospital or for the provision of health care service 10 at the hospital as the directors of the hospital determine; 11  (3) to a municipality in which a health facility is operated, $2,000 per 12 bed for each bed actually used for patient care [, LIMITED TO THE NUMBER OF 13 BEDS PROVIDED FOR IN THE CONSTRUCTION DESIGN OF THE HEALTH 14 FACILITY,] or $8,000 per health facility as the municipality determines. 15 * Sec. 13. AS 29.60.120 is amended by adding a new subsection to read: 16  (g) Only money allocated under AS 29.60.013(b)(9) to the municipal basic 17 services category for health may be used for entitlements under this section. If the 18 amount allocated to that category is insufficient to pay each entitlement or if the 19 amount exceeds that required to pay each entitlement, the amount available shall be 20 distributed pro rata among eligible municipalities. 21 * Sec. 14. AS 29.60.130(a) is amended to read: 22  (a) The department shall pay to a volunteer fire department registered with the 23 state fire marshal and serving an area not in an organized municipality a sum for 24 protection purposes equal to $5 [$10] per capita for the population served by the fire 25 department, as determined by the Department of Community and Regional Affairs 26 [STATE FIRE MARSHAL]. 27 * Sec. 15. AS 29.60.140(a) is amended to read: 28  (a) The department shall pay to each unincorporated community an entitlement 29 each fiscal year to be used for a public purpose. The department with advice from the 30 Department of Law shall determine whether there is in each unincorporated community 31 an incorporated nonprofit entity or a Native village council that will agree to receive

01 and spend the entitlement. If there is more than one qualified entity in an 02 unincorporated community, the department shall pay the money under the entitlement 03 to the entity that the department finds most qualified to receive and spend the money. 04 The department may not pay money under an entitlement to a Native village council 05 unless the council waives immunity from suit for claims arising out of activities of the 06 council related to the entitlement. A waiver of immunity from suit under this 07 subsection must be on a form provided by the Department of Law. If there is no 08 qualified incorporated nonprofit entity or Native village council in an unincorporated 09 community that is willing to receive money under an entitlement, the entitlement for 10 that unincorporated community may not be paid. Neither this subsection nor any action 11 taken under it enlarges or diminishes the governmental authority or jurisdiction of a 12 Native village council. The [IF AT LEAST $41,472,000 IS APPROPRIATED FOR 13 ALL ENTITLEMENTS UNDER AS 29.60.010 - 29.60.310 FOR A FISCAL YEAR, 14 THE] entitlement for each unincorporated community under this subsection for each 15 [THAT] year equals $7,500 [$40,000. OTHERWISE, THE ENTITLEMENT EQUALS 16 $25,000]. 17 * Sec. 16. AS 29.60.290(a) is amended to read: 18  (a) A municipality qualifying for an entitlement under the Alaska municipal 19 basic services program [AS 29.60.010 - 29.60.080 OR 29.60.100 - 29.60.180] shall 20 receive a minimum payment of $40,000 [PLUS AN AREA COST-OF-LIVING 21 DIFFERENTIAL] for each fiscal year if 22  (1) the municipality has conducted a regular election during the state 23 fiscal year preceding the year in which the department's computation 24 [DETERMINATION] of the municipality's entitlement [MILLAGE RATE 25 EQUIVALENT ] is made [UNDER AS 29.60.030] and has reported the results of the 26 election to the commissioner; 27  (2) regular meetings of the governing body are held in the municipality 28 during the state fiscal year preceding the year in which the department's computation 29 [DETERMINATION] of the municipality's entitlement [MILLAGE RATE 30 EQUIVALENT] is made [UNDER AS 29.60.030] and a record of the proceedings is 31 maintained;

01  (3) a municipal budget has been adopted for the fiscal year during 02 which payment of an entitlement is authorized [BY AS 29.60.010 - 29.60.080 OR 03 29.60.100 - 29.60.180] and an audit or financial statement for the fiscal year preceding 04 the year in which the department's computation [DETERMINATION] of the 05 municipality's entitlement [MILLAGE RATE EQUIVALENT] is made [UNDER 06 AS 29.60.030] has been prepared and furnished to the department in accordance with 07 AS 29.20.640(a); [AND] 08  (4) local ordinances adopted by the municipality have been codified in 09 accordance with AS 29.25.050; and 10  (5) the municipality is providing services in at least two of the nine 11 municipal basic services categories listed in AS 29.60.013(b). 12 * Sec. 17. AS 29.60.290(c) is amended to read: 13  (c) The department shall pay under this section to each municipality eligible 14 to receive a minimum payment [UNDER THIS SECTION] an amount equal to the 15 difference between $40,000 [THE MINIMUM PAYMENT DETERMINED UNDER 16 (a) AND (b) OF THIS SECTION] and the sum of the amounts payable for the same 17 fiscal year under AS 29.60.013, 29.60.110, [AS 29.60.010 - 29.60.080] and 29.60.120 18 [29.60.100 - 29.60.180] . 19 * Sec. 18. AS 29.60 is amended by adding a new section to read: 20  Sec. 29.60.295. INDIAN RESERVES ORGANIZED UNDER FEDERAL 21 LAW. (a) An Indian reserve organized under federal law that existed before 22 enactment of 43 U.S.C. 1618(a) and is continued in existence under that subsection is 23 eligible for an entitlement under AS 29.60.013, 29.60.110, and 29.60.120 under the 24 conditions applicable to a municipality that, in the determination of the department, are 25 appropriately applied to the reserve, and subject to the following additional 26 requirements: 27  (1) the reserve must have adopted a budget for the fiscal year in which 28 the entitlement is payable and provided a copy to the department; 29  (2) the reserve must have prepared an audit for the fiscal year 30 preceding the year the amount of the entitlement is computed by the department and 31 provided a copy to the department;

01  (3) during the fiscal year in which the entitlement is payable the reserve 02 must be providing services in at least two of the municipal basic services categories 03 listed in AS 29.60.013(b); and 04  (4) the reserve must have formed a community development 05 corporation with authority to determine how the entitlement will be used and ensure 06 that the use complies with all applicable law, and the corporation must have 07  (A) delivered to the department a written waiver of sovereign 08 immunity from legal action by the state to recover all or a portion of the 09 entitlement; 10  (B) during the state fiscal year preceding the year in which the 11 entitlement computation is made by the department, conducted an election for 12 members of its board of directors open to all residents of the reserve who are 13 registered and qualified to vote in state elections; and 14  (C) provided a copy of the results of the election held under 15 (B) of this paragraph to the department. 16  (b) The department may pay an entitlement under this section only to the 17 community development corporation formed by the Indian reserve. If the department 18 pays an entitlement under this section during a fiscal year, no other entity in the 19 reserve may receive an entitlement during the same fiscal year under AS 29.60.130 or 20 29.60.140. 21  (c) A reserve that qualifies for an entitlement under this (a) of this section 22 during a fiscal year qualifies for a minimum payment of $40,000 for that year. The 23 department shall pay under this subsection to the community development corporation 24 of a reserve that qualifies for a minimum payment the difference between $40,000 and 25 the amount of entitlement the reserve qualifies for under (a) of this section. 26 * Sec. 19. AS 29.60.310 is amended to read: 27  Sec. 29.60.310. TIME OF PAYMENT. The department shall make payments 28 under the Alaska municipal basic services program [AS 29.60.010 - 29.60.300] no 29 later than July 31, based upon the entitlement calculations made during the preceding 30 fiscal year. 31 * Sec. 20. AS 29.60 is amended by adding a new section to article 3 to read:

01  Sec. 29.60.330. DEFINITION. In AS 29.60.011 - 29.60.310, "taxing unit" 02 means a municipality, and 03  (1) in a borough or unified municipality, a service area or the entire 04 area outside cities; 05  (2) in a city, a differential tax zone. 06 * Sec. 21. AS 37.06.030(a) is amended to read: 07  (a) For each draw made by a municipality under AS 37.06.010, the 08 municipality shall contribute a local share to the cost of the capital project for which 09 the draw is made. The amount of the local share equals the local share percentage as 10 calculated under (1) of this subsection, divided by the state share percentage as 11 calculated under (2) of this subsection, multiplied by the amount of the draw. For 12 purposes of this subsection, 13  (1) the local share percentage is 14  (A) 30 percent for a municipality with a population of 5,000 or 15 more; 16  (B) for a municipality with a population of 1,000 - 4,999, the 17 greater of 18  (i) 15 percent; or 19  (ii) the percentage obtained by dividing the amount that 20 would be received by the municipality from a property tax levy of 1/1000th of 21 a mill per $1,000 of grant funds received by the sum of that first amount plus 22 the amount of the grant or draw, but not more than 30 percent; 23  (C) for a municipality with a population of under 1,000, the 24 greater of 25  (i) five percent; or 26  (ii) the percentage obtained by dividing the amount that 27 would be received by the municipality from a property tax levy of 1/1000th of 28 a mill per $1,000 of grant funds received by the sum of that first amount plus 29 the amount of the grant or draw, but not more than 30 percent; 30  (2) the state share percentage equals one minus the local share 31 percentage;

01  (3) the local share to be contributed by a municipality may be satisfied 02 with (A) federal, municipal, or local money; (B) labor, materials, or equipment used 03 directly in the construction of the project, or land, including land transferred by the 04 state to the municipality; the department shall determine the value of a contribution 05 under this subparagraph; (C) money from another nonstate source; (D) money received 06 by the municipality under AS 29.60.011 - 29.60.330 (Alaska municipal basic services 07 program) [AS 29.60.010 - 29.60.375]; (E) state taxes refunded or reimbursed to the 08 municipality whose use for the purposes of this subsection is not prohibited; (F) 09 allocations of state aid for the costs of school construction debt under AS 14.11.100; 10 and (G) money obtained from the sale or lease of land or other assets transferred by 11 the state to the municipality; except as provided in this paragraph, the local share may 12 not be satisfied with money from, or with the portion of an asset that was obtained 13 with money from, an appropriation, allocation, entitlement, grant, or other payment 14 from the state. 15 * Sec. 22. AS 37.06.030(b) is amended to read: 16  (b) For each draw made by an entity or council under AS 37.06.020, the 17 incorporated entity or Native village council that makes the draw shall contribute a 18 local share of the cost of the capital project for which the draw is made. The amount 19 of the local share equals the local share percentage as calculated under (1) of this 20 subsection, divided by the state share percentage as calculated under (2) of this 21 subsection, multiplied by the amount of the draw. For purposes of this subsection, 22  (1) the local share percentage is five percent; 23  (2) the state share percentage equals one minus the local share 24 percentage; 25  (3) the local share may be satisfied from (A) federal or local money; 26 (B) labor, materials, or equipment used directly in the construction of the project, or 27 land, including land transferred by the state; the department shall determine the value 28 of a contribution under this subparagraph; (C) money from another nonstate source; 29 (D) money received by the unincorporated community under AS 29.60.011 - 29.60.330 30 (Alaska municipal basic services program) [AS 29.60.010 - 29.60.375]; or (E) 31 money obtained from the sale or lease of land or other assets transferred by the state;

01 except as provided in this paragraph, the local share may not be satisfied with money 02 from, or with the portion of an asset that was obtained with money from, an 03 appropriation, allocation, entitlement, grant, or other payment from the state. 04 * Sec. 23. AS 41.15.180(d) is amended to read: 05  (d) From the percentage of the unorganized borough national forest receipts 06 fund allocated to public roads under (b) of this section, the commissioner shall pay to 07 each 08  (1) home rule city, first class city, or second class city that exercises 09 road powers, that is located within the unorganized borough and within a national 10 forest or within 20 miles of a national forest, a share of the income from the roads 11 allocation of the fund; a home rule city, first class city, or second class city's share 12 shall be calculated as the proportion of the number of road miles within municipal 13 boundaries over which the community exercises road powers plus the number of state 14 road miles maintained by the municipality under agreement with the state compared 15 to the total number of road miles maintained by state or local governments in the 16 unorganized borough and within the national forest or within 20 miles of the national 17 forest; 18  (2) [MUNICIPALITY ORGANIZED UNDER FEDERAL LAW 19 AS AN] Indian reserve organized under federal law that existed before the enactment 20 of 43 U.S.C. 1618(a) and is continued in existence under that subsection and that has 21 formed a community development corporation under AS 29.60.295(a) [AS 29.60.365], 22 that exercises road powers and that is located within the unorganized borough and 23 within the national forest or within 20 miles of the national forest a share of the 24 income from the roads allocation of the fund; the share due a reserve 25 [MUNICIPALITY] organized under federal law that exercises road powers shall be 26 calculated as the proportion of the number of road miles within reserve 27 [MUNICIPAL] boundaries over which the community exercises road powers plus the 28 number of state road miles maintained by the reserve [MUNICIPALITY] under 29 agreement with the state compared to the total number of road miles maintained by 30 state or local governments in the unorganized borough and within the national forest 31 or within 20 miles of the national forest; however, the commissioner may pay income

01 from national forest receipts under this paragraph only after the community 02 development corporation has delivered a written waiver of sovereign immunity from 03 legal action by the state to recover all or a portion of the money distributed under this 04 section. 05 * Sec. 24. AS 29.10.200(49); AS 29.60.010, 29.60.030(a), 29.60.030(c), 29.60.050, 06 29.60.060, 29.60.070(c), 29.60.080, 29.60.100, 29.60.130(b), 29.60.150, 29.60.160, 29.60.170, 07 29.60.180, 29.60.280, 29.60.290(b), 29.60.290(d), 29.60.290(e), 29.60.300, 29.60.350, 08 29.60.360, 29.60.365, 29.60.370, and 29.60.375 are repealed. 09 * Sec. 25. TRANSITION. (a) Notwithstanding AS 29.60.310 as amended in sec. 19 of 10 this Act and other provisions of law, the department shall calculate entitlements and make 11 payments under the Alaska municipal basic services program and under this section for fiscal 12 year 1996 no later than February 1, 1996. Notwithstanding other provisions of law, the sum 13 of all entitlements to a municipality under AS 29.60.013, 29.60.110, and 29.60.120 for 14 (1) fiscal year 1996 may not be decreased by more than two percent of the 15 sum of all entitlements received by that municipality during fiscal year 1995 under 16 AS 29.60.010 - 29.60.375 as those statutes existed before the effective date of this Act; 17 (2) fiscal year 1997 may not be decreased by more than two percent of the 18 amount received during fiscal year 1996 under AS 29.60.011 - 29.60.330 (the Alaska 19 municipal basic services program) or under (1) of this section; 20 (3) each fiscal year after 1997 may not be decreased by more than five percent 21 of the amount received during the immediately preceding fiscal year under AS 29.60.011 - 22 29.60.330 (the Alaska municipal basic services program) or this section. 23 (b) If appropriations during a fiscal year for the Alaska municipal basic services 24 program are not sufficient to fully fund transitional entitlements under (a) of this section, the 25 amount available, after fully funding entitlements under AS 29.60.130, 29.60.140, and 26 29.60.290, shall be distributed on a pro rata basis. 27 * Sec. 26. This Act takes effect July 1, 1995.