Legislature(2007 - 2008)BARNES 124
05/11/2007 08:00 AM House COMMUNITY & REGIONAL AFFAIRS
| Audio | Topic |
|---|---|
| Start | |
| SB72 | |
| SB131 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | SB 72 | TELECONFERENCED | |
| + | SB 131 | TELECONFERENCED | |
SB 72-COMMUNITY REVENUE SHARING 8:05:19 AM CO-CHAIR FAIRCLOUGH announced that the first order of business would be CS FOR SENATE BILL NO. 72(FIN), "An Act relating to the community revenue sharing program; and providing for an effective date." 8:06:03 AM REPRESENTATIVE PAUL SEATON, Alaska State Legislature, explained that the difference between CSSB 72(FIN) and the proposed committee substitute (CS), Version 25-LS0506\V, Cook, 5/9/07, is that Version V incorporates HB 202 provisions in order to include unincorporated communities within organized boroughs in the formula. By including unincorporated communities within organized boroughs in the formula, a disincentive that is built into the program is eliminated. Currently, unincorporated communities in an unorganized borough receive direct revenue sharing. However, if those areas incorporate as a borough, those areas would lose that direct revenue sharing. [Version V] equalizes the amount unincorporated communities outside the borough and municipalities receive. Version V also changes the amount the unorganized community receives from 5 percent to 7 percent, which is necessary for the per capita allocation and provides for the 30 communities that will be included. He pointed out that it's also necessary to increase the amount from $48.1 million to $49.1 million, which increases what all the municipalities receive. For instance, Anchorage would gain a little over $177,000. REPRESENTATIVE SEATON drew attention to page 2, lines 5 and 22, which change the percent of revenue sharing. Version V [maintains] the amount of [the community revenue sharing fund] at $50 million or 3 percent from the state's resources, whichever is less. On page 2, line 20, there's a technical change in which the term "subsection" replaces the term "paragraph" so that the cap is at $50,000 as proposed. On page 5, lines 4-6, language allowing unincorporated communities in organized boroughs to qualify for the revenue sharing payment is included. The change on page 5, line 2, merely adds the following conforming language: "located in the unorganized borough". The language on page 5, lines 16-31, inserts a provision that requires that in order for a community in an organized borough to be eligible for the payment, at least three of the listed services must be provided. On page 6, line 6, the term "unincorporated community" was added in order to ensure that the populations of unincorporated communities in the organized borough aren't counted double with the per capita for the boroughs. Representative Seaton explained that the population of the municipality is subtracted from the borough population so that there's no double dipping. The [new provision] ensures that the population of the unincorporated communities wouldn't be included in the borough population and, again avoid any double dipping. Page 6, lines 15-17, expand the definition of unincorporated community. He also pointed out that the fiscal note has increased from $48.1 million to $49.1 million. 8:12:56 AM CO-CHAIR LEDOUX moved to adopt HCS CSSB 72, Version 25-LS0506\V, Cook, 5/9/07, as the working document. There being no objection, Version V was before the committee. 8:13:24 AM REPRESENTATIVE NEUMAN, referring to page 5, lines 1-4, inquired as to the criteria used. REPRESENTATIVE SEATON answered that it's the same criteria the Department of Commerce, Community, & Economic Development (DCCED) has used in the past for revenue sharing. REPRESENTATIVE NEUMAN explained that he asks because he felt that there would be a squabble over that, and therefore he requested the definition of the criteria. 8:15:02 AM REPRESENTATIVE SALMON inquired as to the difference in unincorporated communities as in HB 202 versus HCS CSSB 72, Version V. REPRESENTATIVE SEATON responded that there's no difference for those in the unorganized borough as the definition of unincorporated communities remains the same as was specified in HB 202. The definition was that a community [in order to qualify] has to provide three of the essential services listed and do so independent of borough funding. That test isn't present for those unincorporated communities outside of a borough. REPRESENTATIVE SALMON inquired as to the difference in [the definition of] unincorporated community between CSSB 72(FIN) and Version V. REPRESENTATIVE SEATON explained that the allocation formula [under Version V] was increased to 7 percent for all unincorporated communities, which includes 30 unincorporated communities that are in the borough such as Tyonek. Under SB 72, Tyonek wouldn't receive any funding. However, Tyonek would receive funding under Version V because it provides [at least three] of the services specified in Version V. REPRESENTATIVE SALMON inquired as to what happens to the allocation to the borough when [communities such as Tyonek] receive funding. REPRESENTATIVE SEATON specified that there's a per capita distribution as well as a $25,000 base distribution to an unincorporated community. He explained that the per capita distribution is subtracted from the allocation to the borough in order to avoid counting the population twice. 8:18:18 AM REPRESENTATIVE SALMON questioned what happens to the money given to the unincorporated area since villages and boroughs are being given extra money. REPRESENTATIVE SEATON explained that it's why the $1 million was added to the fiscal note and the revenue sharing percentage for unincorporated communities was changed from 5-7 percent. The aforementioned results in fully funding [the newly included unincorporated areas] without changing the other unincorporated areas while providing a bit of additional funding to the municipality. 8:20:03 AM JEROME SELBY, Mayor, Kodiak Island Borough, related support for Version V. He informed the committee that an unincorporated village is located in the Kodiak Island Borough. The Kodiak Island Borough will take a reduction of a little less than $2,000 in order for that village to receive $27,000 [in revenue sharing], which the borough views as a good change. He urged the committee to adopt Version V because the unincorporated communities inside organized areas should be treated the same way in which those outside the organized areas are treated. He opined that this legislation will be a huge factor in communities remaining viable. 8:22:11 AM JOHN STEIN, Municipal Administrator, City and Borough of Sitka, related Sitka's support for [Version V] and community revenue sharing, which is important to all regions of Alaska. He highlighted that many communities, such as those in Southeast Alaska, aren't in direct contact with the oil economy. Therefore, the opportunity to share in the state's revenue is very important, he opined. Having funds coming from the state will be very helpful in helping communities maintain the myriad of services communities provide. This bill will go a long way to support the aforementioned, and therefore he encouraged the committee to pass [Version V]. 8:24:09 AM JEFF JABUSCH, Finance Director, City of Wrangell, related Wrangell's support of Version V. He pointed out that Wrangell is a depressed economy, and noted that he has faxed the committee documentation outlining some of the problems Wrangell faces in trying to balance its budget and provide basic services. Mr. Jabusch opined that Wrangell feels that it's doing its part to maintain services for the community. The revenue sharing program would help Wrangell. He noted his appreciation for all the work the state and others have done with revenue sharing. He concluded by urging the committee to pass [Version V]. 8:26:02 AM TAMMIE WILSON encouraged passage of SB 72, and thanked all those who worked on the legislation. 8:26:43 AM JEFF CURRIER, Manager, Lake and Peninsula Borough, began by informing the committee that he has been in Alaska for almost 30 years and has observed the change that has occurred since the disappearance of revenue sharing. He said that he has also observed villages in the Lake and Peninsula Borough struggle to continue to provide services to residents that no one else would provide. Mr. Currier related hat he is in strong support of this legislation, which is extremely important as these funds will make a tremendous difference in villages. He commented that he hopes that once this legislation passes, it stays in place for a number of years in order for villages to be healthy again. 8:28:21 AM KATHY WASSERMAN, Alaska Municipal League, urged passage of SB 72. Ms. Wasserman pointed out that the Alaska Municipal League (AML) advocates for healthy communities in the state, and therefore AML supports anything that helps to achieve that. 8:29:43 AM DAN SALMON, Community Administrator, Igiugig Village Council; Member, Lake and Peninsula Borough Assembly, related his strong support for the changes [encompassed in Version V]. He then reviewed the services provided by the borough and the need for funds. Mr. Salmon opined that most of the 20 or so communities impacted by this legislation are apathetic and don't even know about SB 72. Furthermore, AML doesn't lobby on behalf of the unincorporated communities. In closing, Mr. Salmon commended the efforts and related his strong support for the inclusion [of unincorporated communities in Version V]. 8:32:53 AM CO-CHAIR FAIRCLOUGH related that the language [including unincorporated communities] was inserted by Co-Chair LeDoux with the help of Representatives Edgmon and Seaton. Upon determining no one else wished to testify, she closed public testimony. 8:34:21 AM CO-CHAIR LEDOUX moved to report HCS CSSB 72, Version 25- LS0506\V, Cook, 5/9/07, out of committee with individual recommendations and the accompanying fiscal notes. CO-CHAIR FAIRCLOUGH objected for purposes of discussion. REPRESENTATIVE SEATON clarified that there is no effect in the base amount to unincorporated communities while the per capita amount is about $6 less than municipalities. 8:35:13 AM REPRESENTATIVE DAHLSTROM surmised then that there's a $6 per person impact on those [outside of the unincorporated areas]. REPRESENTATIVE SEATON replied yes. 8:35:45 AM REPRESENTATIVE NEUMAN opined that the state has been very generous in sharing its revenue, even for totem poles. Therefore, he suggested that if legislators can find funds to fund totem poles and other such projects, those funds should be used to fund more useful services such as those specified in SB 72. Representative Neuman related his belief that the citizens in his district are more appreciative of receiving funds through capital improvement projects. Representative Neuman highlighted that the state will be in a deficit situation in the next few years. 8:38:20 AM CO-CHAIR FAIRCLOUGH recalled that there was a question earlier regarding the language on page 5 about who determines the appropriate entity that will receive the funds. 8:38:49 AM BILL ROLFZEN, Municipal Assistance, National Forest Receipts, Fish Tax, PILT, Division of Community Advocacy, Department of Commerce, Community, & Economic Development, explained that the old revenue sharing regulations specify three criteria that would determine who is most qualified within an unincorporated community. Those regulations would be transferred to this program. The criteria reviews the proposed use of the funds, the administrative capability of each entity, and who is most representative of the community. A questionnaire is sent out to each entity and a public meeting is held in the community. After the aforementioned, the director [of the Division of Community Advocacy] makes a determination that can be appealed to the commissioner of DCCED. REPRESENTATIVE NEUMAN opined that if communities had funds, they would be better prepared to distribute the funds. He further opined that he has observed that when communities have funds, they are able to provide more services. 8:40:38 AM REPRESENTATIVE CISSNA thanked all parties who had a part in this legislation. Although she noted her appreciation with regard to Representative Neuman's comments about the amount of funds the state spends in small communities, she noted that she has found that oftentimes the programs and projects that come to local communities come with additional costs for which there are no funds. This legislation allows communities to make decisions and prioritize their funding, which she opined is the best way to spend the state's dollars. 8:42:01 AM CO-CHAIR FAIRCLOUGH withdrew her objection. There being no further objection, HCS CSSB 72(CRA) was reported from the House Community and Regional Affairs Standing Committee. The committee took an at-ease from 8:42 a.m. to 8:45 a.m.
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