Legislature(2005 - 2006)CAPITOL 124
02/24/2005 08:00 AM House COMMUNITY & REGIONAL AFFAIRS
| Audio | Topic |
|---|---|
| Start | |
| HB133 | |
| HB121 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | HB 133 | TELECONFERENCED | |
| = | HB 25 | ||
| = | HB 121 | ||
ALASKA STATE LEGISLATURE
HOUSE COMMUNITY AND REGIONAL AFFAIRS STANDING COMMITTEE
February 24, 2005
8:07 a.m.
MEMBERS PRESENT
Representative Kurt Olson, Co-Chair
Representative Bill Thomas, Co-Chair
Representative Gabrielle LeDoux
Representative Mark Neuman
Representative Sharon Cissna
Representative Woodie Salmon
MEMBERS ABSENT
Representative Pete Kott
COMMITTEE CALENDAR
SPONSOR SUBSTITUTE FOR HOUSE BILL NO. 133
"An Act relating to incorporation of boroughs and to regulations
of the Local Boundary Commission to provide standards and
procedures for municipal incorporation, reclassification,
dissolution, and certain municipal boundary changes; and
providing for an effective date."
- HEARD AND HELD
HOUSE BILL NO. 121
"An Act relating to consolidating or abolishing certain service
areas in second class boroughs."
- MOVED CSHB 121(CRA) OUT OF COMMITTEE
HOUSE BILL NO. 25
"An Act relating to the sharing of fisheries business tax
revenue with municipalities; and providing for an effective
date."
- BILL HEARING CANCELED
PREVIOUS COMMITTEE ACTION
BILL: HB 133
SHORT TITLE: LOCAL BOUNDARY COMMISSION REGS & POWERS
SPONSOR(S): REPRESENTATIVE(S) COGHILL
02/09/05 (H) READ THE FIRST TIME - REFERRALS
02/09/05 (H) CRA, STA
02/16/05 (H) SPONSOR SUBSTITUTE INTRODUCED
02/16/05 (H) READ THE FIRST TIME - REFERRALS
02/16/05 (H) CRA, STA
02/24/05 (H) CRA AT 8:00 AM CAPITOL 124
BILL: HB 121
SHORT TITLE: SERVICE AREAS IN SECOND CLASS BOROUGHS
SPONSOR(S): COMMUNITY & REGIONAL AFFAIRS
02/02/05 (H) READ THE FIRST TIME - REFERRALS
02/02/05 (H) CRA, STA
02/15/05 (H) CRA AT 8:00 AM CAPITOL 124
02/15/05 (H) Heard & Held
02/15/05 (H) MINUTE(CRA)
02/24/05 (H) CRA AT 8:00 AM CAPITOL 124
WITNESS REGISTER
RYNNIEVA MOSS, Staff
to Representative John Coghill
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Presented SSHB 133 on behalf of the
sponsor, Representative Coghill.
DAN BOCKHORST, Staff
to the Local Boundary Commission
Division of Community Advocacy
Department of Commerce, Community, & Economic Development
Anchorage, Alaska
POSITION STATEMENT: Expressed concerns with SSHB 133.
BOB HICKS, Vice Chair
Local Boundary Commission (LBC)
Anchorage, Alaska
POSITION STATEMENT: Testified that Sections 1-2 of SSHB 133 are
patently unconstitutional.
DARROLL HARGRAVES, Chair
Local Boundary Commission
Anchorage, Alaska
POSITION STATEMENT: Expressed concerns with SSHB 133.
ROBERT KALLIO
Fairbanks, Alaska
POSITION STATEMENT: During discussion of SSHB 133, expressed
concerns with the aggregate voter method of annexation.
DAVE THOMAS
Fairbanks, Alaska
POSITION STATEMENT: Testified in support of SSHB 133.
LARRY MEUNIER
Fairbanks, Alaska
POSITION STATEMENT: During discussion of SSHB 133, expressed
concerns with the aggregate voter method of annexation.
VICKY PADDOCK
Fairbanks, Alaska
POSITION STATEMENT: During discussion of SSHB 133, urged the
committee not to take away her ability to choose [where to
live].
KAREN SAVERDA
Fairbanks, Alaska
POSITION STATEMENT: Urged the committee to pass SSHB 133.
JOE CARLSON
Fairbanks, Alaska
POSITION STATEMENT: Testified that if SSHB 133 can provide
protection against [large government], then he is all for it.
TIM JOYCE, Mayor
City of Cordova
Cordova, Alaska
POSITION STATEMENT: Testified that passage of SSHB 133 will
prevent any future borough formation except in special interest
areas.
ALAN LEMASTER
Gakona, Alaska
POSITION STATEMENT: Encouraged the committee not to pass SSHB
133, but to draft legislation that would work and not have
constitutional challenges.
VICTOR FISCHER
Anchorage, Alaska
POSITION STATEMENT: Speaking as a member of the Constitutional
Convention and the Alaska Territorial Legislature, expressed the
hope that the committee wouldn't act on SSHB 133.
VIOLA JERREL, Ph.D
Homer, Alaska
POSITION STATEMENT: During discussion of SSHB 133, expressed
concerns with the LBC and its regulations.
CRAIG FLEENER
Council of Athabascan Tribal Governments
Fort Yukon, Alaska
POSITION STATEMENT: During discussion of SSHB 133, expressed
concerns with the current LBC regulations.
FREDRICK SHEEN, President
Delta Junction Chamber of Commerce
Delta Junction, Alaska
POSITION STATEMENT: Testified in support of SSHB 133.
DICK SHULTZ
Tok, Alaska
POSITION STATEMENT: Testified that SSHB 133 should move
forward.
ACTION NARRATIVE
CO-CHAIR BILL THOMAS called the House Community and Regional
Affairs Standing Committee meeting to order at 8:07:27 AM.
Representatives Olson, Thomas, LeDoux, Neuman, and Salmon were
present at the call to order. Representative Cissna arrived as
the meeting was in progress.
HB 133-LOCAL BOUNDARY COMMISSION REGS & POWERS
8:08:10 AM
CO-CHAIR THOMAS announced that the first order of business would
be SPONSOR SUBSTITUTE FOR HOUSE BILL NO. 133, "An Act relating
to incorporation of boroughs and to regulations of the Local
Boundary Commission to provide standards and procedures for
municipal incorporation, reclassification, dissolution, and
certain municipal boundary changes; and providing for an
effective date."
CO-CHAIR THOMAS announced that SSHB 133 wouldn't be reported
from committee today.
8:08:23 AM
RYNNIEVA MOSS, Staff to Representative John Coghill, Alaska
State Legislature, presented SSHB 133 on behalf of the sponsor,
Representative Coghill. This legislation is about fairness and
it guarantees that people will be involved in forming local
governments, she said. Ms. Moss specified that SSHB 133
guarantees that when a proposal is submitted to the legislature,
it has already been reviewed by those in the area [to be
annexed]. Furthermore, the legislation requires at least one
public hearing and an election. The legislature also requires
that the proposal must be approved by the voters prior to being
submitted to the legislature. Ms. Moss highlighted that SSHB
133 addresses a gray area with regard to the use of aggregate
votes versus votes that are described in statute. The statute
specifies that there will be a vote of the people who are going
to be annexed and a vote of the people in the existing
municipality. However, a regulation specifies that the Local
Boundary Commission (LBC) can take an aggregate [of the
aforementioned two votes] and a majority approval would allow
the annexation to occur. The aforementioned is contrary to
statute.
8:10:33 AM
REPRESENTATIVE LEDOUX inquired as to the history of this with
regard to the LBC; and asked if there have been a number of
instances involving [the aggregate vote].
MS. MOSS related her understanding that the LBC has never used
an aggregate vote, although it has been the source of discussion
in the Fairbanks area. This legislation specifies that the LBC
won't institute regulations contrary to statute.
8:11:38 AM
REPRESENTATIVE LEDOUX expressed concern that regulations can be
contrary to statute.
MS. MOSS said she was surprised as well.
8:12:15 AM
REPRESENTATIVE NEUMAN spoke in favor of SSHB 133. He suggested
that perhaps new boroughs haven't formed because people haven't
had a say in their communities.
8:13:03 AM
REPRESENTATIVE SALMON inquired as to how SSHB 133 would impact
the current statute.
MS. MOSS clarified that SSHB 133 doesn't impact the statute at
all. She pointed out that AS 29.06.040 specifies that
[annexation] must be approved by a majority of votes of those
residing in the area being proposed to be annexed or detached.
However, the regulation refers to approval by a majority of the
aggregate votes of those who vote in the area proposed for
annexation as well as those who vote in the annexing borough.
This legislation merely adds language in AS 44.33 that specifies
the LBC has to adopt regulations, standards, and procedures that
comply with existing statutes.
REPRESENTATIVE SALMON posed a situation in which Fairbanks
annexed another area. He inquired as to how the vote in the
area proposed for annexation would be compared with the
[annexing borough].
MS. MOSS answered that there would have to be a majority vote in
favor of the annexation from each group.
8:15:18 AM
REPRESENTATIVE SALMON inquired as to what occurs when the
annexing borough receives a majority of votes while the area to
be annexed doesn't.
MS. MOSS clarified that the statute specifies that both votes
[that of the annexing area and the area to be annexed] have to
approve the proposed annexation by a majority in each area,
otherwise the annexation wouldn't occur.
8:15:48 AM
REPRESENTATIVE LEDOUX said she is inclined to support SSHB 133.
However, she inquired as to whether Alaska's current law allows
commissions to overrule statute, which she characterized as a
larger problem.
MS. MOSS informed the committee that an interim project is going
to be to review other regulations and whether they comply with
statute.
8:16:29 AM
CO-CHAIR OLSON asked whether the Homer annexation a few years
ago was an aggregate vote.
MS. MOSS said that she didn't know.
CO-CHAIR OLSON related his understanding that the Homer
annexation was ambiguous enough that a lawsuit is still going
on.
8:17:34 AM
DAN BOCKHORST, Staff to the Local Boundary Commission, Division
of Community Advocacy, Department of Commerce, Community, &
Economic Development (DCCED), explained that the Homer
annexation was a legislative review annexation processed under
Article X, Section 12 of the constitution. Therefore, the Homer
annexation didn't involve an aggregate vote or any vote.
8:18:08 AM
REPRESENTATIVE SALMON inquired as to the process the Homer
annexation followed.
MR. BOCKHORST reiterated that the Homer annexation followed the
proceeding set out in the constitution [under Article X, Section
12]. The constitutional proceeding has been used in excess of
125 times to initiate annexation or other boundary proceedings.
Mr. Bockhorst explained that the constitutional proceeding
requires an initiation of a petition by the local government or
some other group of citizens. Under this process there is
extensive public notice of the filing of the petition and
opportunity for interested parties to file comments and
responsive briefs on the proposal to which the petitioner has an
opportunity to respond. The department and the staff of the LBC
are required to prepare a preliminary report examining the
petition, the responsive briefs, the reply briefs, as well as
any independent analysis and investigation. The preliminary
report is subject to a minimum of four weeks of public review
and comments. After consideration of the comments on the
preliminary report, the department issues the final report. The
LBC is required by law to go to the area in question and hold at
least one public hearing. The LBC has the opportunity to modify
the petition if it finds it compelling to do so. If the LBC
approves the petition and the petition is for legislative
review, the full legislative review would occur during the first
10 days of the regular session. The legislature can then review
the petition for a 45-day period. If both houses don't reject
the proposal, the proposal would take effect, he explained.
8:21:46 AM
REPRESENTATIVE NEUMAN pointed out that Article III of the Alaska
State Constitution specifies "that in areas not subject to
majority vote." However, AS 29.06.040(c)(1) specifies, "a
proposed annexation and detachment must be approved by a
majority of votes on the question cast by voters residing in the
area proposed to be annexed or detached". Therefore, there
seems to be [conflict] between the constitution and statute.
MR. BOCKHORST confirmed that there are a number of different
procedures by which municipal governments can initiate boundary
changes. He reminded the committee that Article X, Section 12
authorizes legislative review boundary changes, and AS
29.06.040(c) sets out an alternative procedure dealing with
local action annexations in which votes are held. Mr. Bockhorst
informed the committee that he has served as staff to the LBC
for 25 years. During the course of that time, the vast majority
of annexations to city or borough governments with a significant
number of citizens have typically used the legislative review
process. The local option election process has been used a
small number of times. He highlighted the other options for
local option annexations set out in AS 29.06.040(c). For
instance, in an area in which 100 percent of the property owners
and 100 percent of the registered voters want to petition for
annexation, that can be done. The aforementioned is typically
used for a small number or parcels, such as 1-2 lots adjoining
an existing city. He recalled an instance in which the City of
Palmer did a series of 40 annexations using the aforementioned
method by which all the property owners and registered resident
voters had to petition for annexation. Ultimately, the City of
Palmer realized that the aforementioned method isn't the most
efficient and effective way to deal with [annexations].
Therefore, the City of Palmer pursued a legislative review
annexation. Mr. Bockhorst highlighted that the particular
circumstances of a community would dictate the procedure it
would use.
REPRESENTATIVE NEUMAN surmised then that the area [requesting]
the annexation is the group that decides which procedure to
follow.
MR. BOCKHORST clarified that the petitioner, which could be a
local government or a group of citizens, makes the initial
determination as to the process it wants to pursue. However, in
the course of considering the petition that process can be
amended. Therefore, Representative Neuman is correct.
8:26:32 AM
MR. BOCKHORST, in further response to Representative Neuman,
stated that there is substantial opportunity for individuals to
express their views on annexation during the course of the
consideration of the proposal before the LBC. He opined that
the LBC's procedures are well designed to provide for a well-
informed decision on the part of the LBC, local officials, local
citizens, and the legislature. Certainly, the Homer annexation
was very contentious, but the legislature itself, the House and
Senate Community and Regional Affairs Standing Committees, spent
a great deal of time deliberating on the issue and ultimately
agreed with the LBC.
REPRESENTATIVE NEUMAN surmised then that the people who don't
want to be annexed have no legal grounds to [oppose annexation].
MR. BOCKHORST reiterated that the constitution allows annexation
without a vote of the people, just as the constitution has
allowed the legislature to create borough governments without a
vote. However, there is not an absolute guarantee that there
must or will be a vote on any municipal boundary change.
8:29:52 AM
REPRESENTATIVE LEDOUX inquired as to the instances in which the
LBC has used the aggregate method.
MR. BOCKHORST answered that the aggregate voter method has never
been utilized to the point the LBC has rendered a decision on a
proposal. He informed the committee that pending before the LBC
is an annexation proposal by the City of Petersburg. The
aforementioned petition is in the stage in which there is the
opportunity for public comment. This is the first instance in
which [the aggregate vote] process has been used, although other
prospective petitioners have expressed interest in this process.
Mr. Bockhorst clarified earlier testimony by specifying that
there is no provision in the AS 29.06.040 that provides for
separate votes in the municipal government proposing annexation
and the area proposed for annexation. With regard to the
aggregate vote method, Mr. Bockhorst related that during the
course of the Homer annexation, some citizens in Homer expressed
interest in using the aggregate vote method.
8:32:35 AM
REPRESENTATIVE SALMON inquired as to the LBC's view of SSHB 133.
MR. BOCKHORST deferred to the chair of the LBC.
8:33:02 AM
CO-CHAIR OLSON inquired as to the situation in Valdez, and
related his understanding that the [Valdez petition] could
[occur] without the vote of either [the area to be annexed or
the annexing area].
MR. BOCKHORST informed the committee that no petition has been
filed for incorporation of a borough government in Prince
William Sound. However, the City of Whittier has initiated a
process that could lead to the filing of a petition for
incorporation of a borough government using the legislative
review process. The aforementioned could result in the filing
of a petition and a proposal to the legislature for review.
CO-CHAIR OLSON surmised, "We could end up in a situation where
the tail is wagging the dog, with no vote."
MR. BOCKHORST said it's a complex issue that should be placed in
the context of local government in Alaska. The Alaska State
Constitution calls for the division of the entire state into
boroughs. "The Framers of the constitution clearly intended
that areas that had ... administrative and fiscal capacity to
organize would do so," he related. In fact, over the 46 years
of statehood, the legislature, without a vote of the people, has
provided for the creation of borough governments in which 84
percent of Alaskans live today. He reminded the committee that
in 1972, the legislature provided that any second-class city
government with 400 residents or more would automatically be
classified as a first class city.
8:36:05 AM
REPRESENTATIVE LEDOUX returned attention to AS 29.06.040(c)(1).
MR. BOCKHORST clarified that AS 29.06.040(c)(1) must be
considered in context of Article X, Section 12 of the
constitution, which recognizes two very distinct types of
proceedings that can come before the LBC. One type of
proceeding is the earlier discussed legislative review and the
other type is the local option action in which voters have an
opportunity to "have some say in the matter." The statute deals
with local action proceedings. Article X, Section 12 of the
constitution provides the LBC express authority, subject to law,
to establish additional procedures for local action boundary
changes. He related that AS 29.06.040(c)(1) in its entirety
provides that the LBC is obligated by statute and permitted by
the constitution to establish procedures for local action
boundary changes. Those procedures must include, but aren't
limited to, the provisions of AS 29.06.040(c)(1)-(3).
8:39:49 AM
MS. MOSS said that in her earlier testimony she confused this
with service area annexation requirements. However, [allowing]
only those who would be annexed [to vote] is even more
troublesome. She pointed out that the existing regulation
allows those in the existing municipality the ability to vote
and to dilute the vote of the people in the area to be annexed.
8:40:40 AM
BOB HICKS, Vice Chair, Local Boundary Commission (LBC), informed
the committee that he spent a 30-year career as an attorney
specializing in municipal law. He further informed the
committee that he has worked with the LBC for a number of years
on behalf of municipalities, and even assisted in the drafting
of some of the LBC's regulations in the 1980s. Mr. Hicks said
he will discuss some of the technicalities of the law in
Sections 1-2. He characterized Section 3 of SSHB 133 as a
matter of legislative discretion. Sections 1-2 are of serious
concern, he opined. Section 1 prohibits the LBC from amending
or imposing any conditions on a petition to incorporate a city
or borough government. If the aforementioned becomes law, he
questioned why the LBC would ever hold a public hearing on a
petition because no matter the wishes of the people, the
petition couldn't be changed. Under the aforementioned
proposal, every respondent in the region, with any constructive
change, goes unheard. "There isn't even a shadow of democracy
in that kind of a process," he charged. In contrast, the
scenario created by the framers of the constitution in Article
X, Section 12, clearly says, "the commission or board may
consider any proposed local government boundary change".
However, SSHB 133 proposes to change the aforementioned to say,
"the commission may consider only the proposed local boundary
change in the petition and nothing more or less and nothing
different." This, he opined, is a blatant violation of the
constitution, contrary to the delegates of the Constitutional
Convention, and flies in the face of the plain English of
Article X, Section 12.
MR. HICKS turned attention to Section 2 of SSHB 133, which
specifies that the LBC can't submit a proposal for incorporation
of a borough for legislative review unless the voters in the
proposed area have first approved that incorporation. Again,
the aforementioned is in conflict with Article X, Section 12.
He questioned why one would bother to submit a proposal for
incorporation to the legislature for review if the local voters
are allowed to have approval beforehand. As indicated earlier,
Article X, Section 12, provides two separate procedures: a
legislative review process and a local action process. The
legislative review specifies how the procedure will occur and
does not say that the procedure can be changed by law or by the
legislature. The next part of Article X, Section 12, provides a
general statement that the LBC can establish procedures for
local action elections, which, the constitution specifically
says are subject to law. Therefore, the legislature can create
any kind of voter or regional participation it desires in any
local action petition and thus the legislature can make the
changes in the aggregate voting regulation. However, the
legislature doesn't have the power to change the legislative
process. He characterized the democratic process in the
legislative review procedure as being more detached because it
isn't necessarily a direct vote.
MR. HICKS related that if SSHB 133 is enacted as written, then
Article X, Section 12, will read as follows:
The commission may no longer consider any proposed
change, but shall consider only the exact boundary
change described in the petition without regard for
glaring errors and omissions, and without regard for
the advice and the opinions of anyone else in the
effected community. Local action and legislature
review processes are hereby merged into one procedure.
The commission may not present proposed changes to the
legislature during the first 10 days of any
legislative session, unless the proposed changes have
first been approved by voters in the effected area.
MR. HICKS, in conclusion, submitted that Sections 1-2 of SSHB
133 are patently unconstitutional.
8:48:14 AM
DARROLL HARGRAVES, Chair, Local Boundary Commission, said that
he will address policy concerns regarding SSHB 133. Mr.
Hargraves paraphrased from the following written testimony
[original punctuation provided]:
As noted in the bill analysis, Section 1 of the bill
expressly prohibits the LBC from amending and imposing
conditions on a petition to incorporate city
governments and borough governments. To remove such
authority would render the incorporation of city and
borough government particularly rigid proceedings. A
petition could only be approved or denied.
If there were a fatal error in a proposal - for
example, a borough assembly apportionment plan that
does not meet the equal representation provisions of
the State and U.S. Constitutions - the LBC would have
no alternative but to deny the petition. Under
existing law, the petitioners would be precluded from
resubmitting a substantially similar proposal for two
years.
Experience has clearly demonstrated that flexibility
is needed in carrying out the duties of the LBC. That
is why the legislature has long provided express
statutory authority for the Commission to amend and
impose conditions for all matters that come before the
LBC. That includes proposals for city
reclassification and each of the six fundamental
boundary changes that come before the LBC
(incorporation, annexation, detachment, dissolution,
merger, and consolidation).
Section 1 of the bill would impose great obstacles
with regard to city and borough incorporation
proposals. Additionally, ..., we believe that Section
1 has substantial legal flaws.
Section 2 of the bill would only allow the LBC to
submit a legislative review borough incorporation
proposal if the voters of the area first approved the
proposal.
The framers of Alaska's Constitution expressed a
preference for voluntary borough incorporation. The
LBC shares that preference. However, those who wrote
our Constitution recognized that the State could
compel a region to incorporate if that region had the
administrative and fiscal capacity to do so, but took
no initiative to organize. (See: Borough Government
in Alaska, Thomas Morehouse and Victor Fischer, p. 61
- 62 (1971).
In 1963, the State Legislature established a clear
policy that areas with the capacity to organize must
do so. The 1963 Legislature mandated boroughs
encompassing eight regions and more than 80 percent of
all Alaskans. Voters in those eight regions were
given no choice as to whether they would organize.
Nine years later, the State Legislature instituted a
similar policy by mandating that every second-class
city with at least 400 residents be reclassified,
without a vote, to first-class city status. First-
class cities in the unorganized borough have the same
duties and obligations as boroughs. Thus, the effect
of the 1972 Act was similar to the 1963 Mandatory
Borough Act.
Section 2 of SSHB 133 represents a clear reversal of
the legislative policies of 1963 and 1972. If the
Legislature now chooses to annul those long-standing
policies, it could generate fundamental questions of
fairness among the 84 percent of Alaskans that today
live in boroughs that were formed under the 1963
Mandatory Borough Act. The same issue exists with
regard to residents of cities in the unorganized
borough that were reclassified without voter approval
by the 1972 Mandatory City Reclassification Act.
Section 3 of the bill is apparently intended to
nullify the aggregate voter method of annexation.
That method was established by the LBC under its
constitutional authority to "establish procedures
whereby boundaries may be adjusted by local action"
(Article X, Section 12, Constitution of the State of
Alaska) and the Commission's statutory duty to do so.
It is unclear, however, whether Section 3 of the bill
actually accomplishes that end.
The aggregate voter method of annexation provides
local governments and resident's additional tools to
seek boundary changes. Some local governments and
some local residents prefer that method to others. If
that option is eliminated, petitioners will likely
rely on the legislative review method of boundary
change, which provides for no local vote.
Section 4 of the bill nullifies any proposal pending
before the LBC that does not comply with the new terms
of this bill. As noted, I have questions whether
Section 3 actually accomplishes what it is apparently
intended. Moreover, a petition for annexation using
the aggregate voter method is currently pending before
the LBC. I question whether Section 4 runs afoul of
the prohibition in Article I, Section 15 of our
Constitution that prohibits the passage of any ex post
facto law.
8:56:52 AM
REPRESENTATIVE NEUMAN expressed concern with Mr. Hicks'
statement that SSHB 133 doesn't provide a shadow of democracy.
Representative Neuman opined that this legislation allows people
being incorporated into areas to speak.
8:57:55 AM
ROBERT KALLIO informed the committee that he is a resident of
the area on the Elliot Highway proposed to be annexed. Mr.
Kallio provided the following testimony:
The only issue I wish to address is the aggregate vote
regulation of the Local Boundary Commission. This
hearing is not about borough organization, but is
about annexation only. And this is the only real
issue that I am concerned about. I would like to
thank Mr. Coghill and Mr. Harris for having realized
the unfairness of the aggregate vote section of the
Local Boundary Commission regulation. Recent
statements made by Mr. Jim Whitaker, Mayor of
Fairbanks North Star Borough, that he would use the
aggregate vote section as the method to annex a
relatively low populated area in order to generate
between $8-$9 million in real estate taxes, mainly
from the oil, gas, and mining industries, while
showing complete disregard for the actual residents of
this area is truly unfair. This aggregate vote method
truly represents fraud by allowing a densely populated
borough to annex any low populated area deemed as a
target. A population of any target area must be
allowed to vote if they wish to be annexed ... and
that vote must count and must not only be part of an
aggregate vote, which greatly out numbers the area
residents to be annexed. The current aggregate vote
regulation of the Local Boundary Commission ... is
quite similar to pre-war Germany's annexation of
Czechoslovakia and Poland .... We are supposed to
have a government of the governed, not a government
that dictates to the governed. Let those people in
the area proposed to be annexed vote yes or no to be
annexed or not. This aggregate vote method is not
fair, it is not moral, and it is not right.
9:00:46 AM
DAVE THOMAS informed the committee that he, too, lives in [the
area on the Elliot Highway proposed to be annexed]. Mr. Thomas
related his support of SSHB 133. He recalled earlier testimony
that this is a complex issue, but he suggested that such is said
as a befuddlement.
9:02:10 AM
LARRY MEUNIER suggested that if Sections 1-2 of SSHB 133 are of
legal concern, perhaps they need to be reviewed. Mr. Meunier
expressed concern with the aggregate vote [method], which he
characterized as a means of annexation without those being
annexed having a say. Addressing the aggregate vote method
doesn't take anything away from the LBC's ability to alter
portions of the proposal.
9:04:41 AM
VICKY PADDOCK informed the committee that she lives in Joy,
Alaska because it's the Last Frontier. She related that she
hauls her own water and cuts her own wood and nature walks
through her yard. Ms. Paddock emphasized that she chose this
way of life and lives [in Joy] because she can't afford to live
in town. Furthermore, she said she enjoys her freedom and peace
in Joy. Ms. Paddock opined that Mayor Whitaker is "out there"
for the larger entities, such as the oil and gas entities. She
recalled that Mayor Whitaker has said that the [Fairbanks North
Star Borough] is in the black, and therefore she questioned why
the borough needs [to annex] this small community. She
predicted that as soon as [Joy] is annexed, the people in the
area will lose their homes because of their inability to pay the
taxes. Ms. Paddock concluded by urging the committee to not
take away her [ability] to choose [where to live].
9:07:24 AM
KAREN SAVERDA informed the committee that she, too, is a
resident of Joy, Alaska. She related her own experience in
which she was able to make a life and own property [in Joy] on a
widow's pension. The mistakes that may have been made in the
past by government with regard to [consolidation and taxation]
should stop, she stated. Since the [Fairbanks North Star
Borough] is in the black, she, too, questioned why the borough
can't manage its money and do without hers. She said that she
didn't want to lose the lifestyle she has worked so hard to
achieve and that she enjoys. Ms. Saverda opined that she has a
right to vote when someone wants to [tax] her property. She
urged the committee to pass SSHB 133 so that she can vote [on
these annexation matters] and continue her lifestyle in Alaska.
9:11:42 AM
JOE CARLSON related that he is probably the largest landowner in
the [Joy] area. Mr. Carlson echoed the earlier testimony with
regard to the rural lifestyle that he tries to maintain. This
legislation is trying to provide people a tool, he surmised.
However, he said he didn't want to be part of large government.
Mr. Carlson stated that [those in the Joy/Livengood area] are
looking for help because they feel they're being oppressed by
large [government]. If SSHB 133 can provide protection [against
large government], then he said he's all for it. Mr. Carlson
recalled that in 1989 the Fairbanks North Star Borough wanted to
annex the area, but somehow the LBC said "no." Mr. Carlson
stated that he spends all his money in the borough, and
therefore he questioned why it needed more of his money.
9:15:17 AM
TIM JOYCE, Mayor, City of Cordova, paraphrased from the
following written testimony [original punctuation provided]:
William Egan expressed the view that boroughs
represented a "better form of local government." In
1963, Governor Egan signed the Mandatory Borough Act
into law. This created 8 boroughs, which today
encompasses almost 84% of the state's population.
These people did not vote to form a borough, but those
borough governments have been working fine for the
past 42 years.
A borough is an important if not essential tool to
respond to the impacts of low levels of education
funding and in dealing with continued cuts in funding
for local governments, i.e. revenue sharing. It is
also the most effective means to address important
regional planning and economic development issues.
Borough formation represents good public policy from a
statewide perspective in several important aspects.
1. It fosters greater compliance with the equal
protection clause of Article 1, Section 1 of the state
constitution. Specifically, it would increase the
extent to which citizens of Alaska have comparable
obligations to support local services.
2. Article 10, Section 1 of the state
constitution encourages borough formation. The
constitutional concept of municipal government in
Alaska is predicated upon the presumption that
organized boroughs will exist wherever areas are
capable of supporting them.
3. Creation of boroughs would dramatically ease
the financial burdens on the state. For example,
education costs for the state would decline because
local contributions required of borough school
districts would increase.
In 1988, the city of Valdez organized a PWS [Prince
William Sound] Borough Feasibility Study Group. The
group hired Darbyshire & Associates to conduct the
study, which was completed in April of 1988. The
conclusions reached by the study indicated that a
basic borough exercising only mandatory powers is a
very viable proposition for residents of the area.
Another study was conducted for PWS by Northern
Economics, ResourcEcon and Darbyshire & Associates in
1997, which concluded that the people of PWS would be
better served by leaders who are proactive in the
matter of borough formation rather than waiting to
react to other borough annexation requests or the
state legislature. yy
Requiring a vote on every borough formation can be
likened to an annexation into a city. Those people
that are outside the city limits reap the benefits of
schools, libraries, roads and more, yet pay little or
nothing in taxes to support those services. They
resist annexation to avoid paying those taxes and
would certainly vote against it. In 1992, the City of
Cordova passed a resolution requesting to annex
population developments near the old city. In 1993,
the Local Boundary Commission approved the annexation
and passed that recommendation along to the state
legislature, which approved it by legislative review.
No vote was cast in this annexation.
The same issues arise with borough formation, but can
be taken one step further. When local officials in
some areas are strongly opposed to being included with
other communities in regional boroughs, their views
are likely shared by many of the voters in the area as
well. Thus, voters in parochial or special interest
areas would most times dictate the outcome of an
election, in effect preventing any borough formation.
Passage of HB 133 will prevent any future borough
formation except in special interest areas, which will
insure that only small special interest boroughs will
ever form in the future, which is contrary to the
ideas of the framers of the state constitution.
9:19:45 AM
ALAN LEMASTER recalled reading that there is consideration in
Juneau to provide some incentive for areas to form boroughs with
$5 million in seed money and half of the state lands being given
to the boroughs. He asked if the committee has heard of the
aforementioned and whether it's going anywhere.
CO-CHAIR THOMAS answered that Mr. LeMaster was referring to the
LBC's [suggestion] for an incentive to encourage the formation
of boroughs, but noted that nothing has happened.
MR. LEMASTER opined that in the event SSHB 133 passed, it would
be years, possibly even decades, before areas such as Copper
Valley would become boroughs. Mr. LeMaster announced that he is
opposed to [his area] becoming a borough. He opined that the
only option [for the Copper Valley], if it doesn't want to be
annexed into another borough, is to create its own borough. He
said that putting [annexation] to a vote will result in the
[annexation] being voted down, which is an advantage. Mr.
LeMaster said that he disagrees with the provision whereby the
LBC would be restricted from providing any assistance in the way
of review or change in a proposal. Therefore, the
aforementioned portion of the legislation has to be eliminated,
he said. The LBC, the experts on these matters, must be kept in
the loop. He indicated that those living in Copper Valley live
in the area for the same reasons as those in Joy. In
conclusion, Mr. LeMaster encouraged the committee to not pass
SSHB 133, but to draft legislation that would work and not have
constitutional challenges.
9:24:58 AM
VICTOR FISCHER spoke as a member of the Constitutional
Convention and the Alaska Territorial Legislature. Mr. Fischer
paraphrased from the following written testimony [original
punctuation provided]:
Mr. Chairman, as you probably know, I have spent
almost 55 years on issues of local government in
Alaska. And I was a member of the Constitutional
Convention; I was a member of the last Alaska
Territorial Legislature; back in the 80s, I served in
the Alaska State Senate.
I have continued to be concerned about the
Constitution, about the implementation, in particular,
of the local government article. I think, of all the
parts of the Constitution that have not been
adequately dealt with, it is the local government
article. I might say that HB 133 would be a big step
backward from where we are today - and today we are
not where we should be.
I don't want to address the specific issues of
annexation right now, I would be glad to get into that
some other time.
One of the key elements of the local government
article of the Constitution was the division of all of
Alaska into separate boroughs - organized and
unorganized.
Through early actions and inactions after statehood,
we have ended up with a series of organized boroughs.
Reference has been made to those that were
incorporated by legislative action. We've had an
equal number of boroughs that were established as
organized by local action - by desire of regions
throughout Alaska to become organized. There were
various reasons for ....
We have very effectively functioning boroughs. We
have a whole series of home-rule boroughs exercising
the ultimate authorities of self-government. And I
would say that if you did put borough status to a vote
in all of these, I have a hunch that all of them would
vote to keep the borough status rather than reverting
to the amorphous unorganized borough that really is
not a creature of self-government whatsoever.
The initial concept was, again, that all of Alaska,
including unorganized areas, would be established as
boroughs. Many would remain unorganized, but they
would allow the people in the particular area a
measure of self-governance, of participation in
planning for their particular region in the delivery
of coordinated delivery of State services and so on.
We can discuss this for hours - so I will not do it.
I mainly want to emphasize that the time right now is
to help make the local government system work rather
than undermine it. And I think that SSHB 133 would
undermine the existing effort to make something out of
the local government system of Alaska.
The Local Boundary Commission was established
specifically for the purpose of rationalizing
boundaries in Alaska. It was established with the
realization that it takes a State level body to look
at Alaska, to look at issues more than local self-
interest - and look at boundary issues from the
standpoint of what is best for all of the people of a
region; what is in the interest of the State. And
therefore, limiting the jurisdiction and the ability
of the Boundary Commission to be effective would be a
very, very negative step - a horrendous step backward.
And as Hicks said in the beginning - my first reaction
was exactly the same language - that the provisions in
Sections 1 and 2 are patently unconstitutional. They
go against every intent of the Constitutional
Convention; they go against the language of the
Constitution, and against all the court decisions that
have been rendered regarding the authority of the
Local Boundary Commission in making changes and making
proposals to the legislature.
I hope that you will not act on House Bill 133, and I
truly hope that you will devote some real solid time
to looking at all of Alaska - to looking at it from
the standpoint of the basic responsibility of the
Community and Regional Affairs Committee to help make
the system work rather than undermining the system.
And if I can be of any help whatsoever, I am at your
disposal.
9:32:00 AM
VIOLA JERREL, Ph.D, disagreed with Mr. Bockhorst's testimony.
The current and previous LBC, she opined, have dictated and
exceeded its authority under the Alaska and US constitutions.
She discussed the need for due process of law. She charged that
those in Homer were robbed of the right to vote [during the last
annexation] and that annexation is still being opposed.
Alaskans Opposed to Annexation, a group which she helped form,
hired Attorney Robert C. Erwin, who is a former Alaska Supreme
Court justice. Mr. Erwin issued a legal opinion regarding the
right to vote under statute. She turned attention to AS 29,
which refers to the requirement of annexation to be approved by
a majority of the voters [in a vote] cast by voters residing in
the area proposed to be annexed. She charged that the City of
Homer annexation was illegal. Dr. Jerrel related her opposition
to the LBC regulations regarding the aggregate vote method and
the approval of the majority of the voters in the annexing area
when annexing an uninhabited territory. Dr. Jerrel reviewed her
extensive education. She went on to emphasize that this
annexation process is all wrong and the LBC has too much
authority. Dr. Jerrel recalled a November hearing in Homer when
audio was so bad and people weren't being heard. She opined
that the LBC doesn't listen to the people, but only to Mr.
Bockhorst. She suggested that when considering SSHB 133, it
would help to consider 3 AAC 110.010 and 3 AAC 110.990. Dr.
Jerrel related her belief that the [LBC's] conditions for
annexation aren't legal. She then highlighted the limitations
of advocacy, which she said discourages people from responding.
Dr. Jerrel related how the LBC has misinformed the public with
regard to taking testimony. In response to Co-Chair Thomas, Dr.
Jerrel agreed to fax any information she had on this topic to
the committee. Dr. Jerrel then mentioned 16 American
Jurisprudence 2d, [section] 256, which generally provides all
information on constitutional rights.
9:41:14 AM
CRAIG FLEENER, Council of Athabascan Tribal Governments,
informed the committee that the Council of Athabascan Tribal
Governments is a consortium of the 10 tribes in the Yukon Flats.
He said that he would discuss his concerns with annexation and
what it means for those in the Yukon Flats. Mr. Fleener stated
that since Mayor Whitaker expressed interest in annexing land in
the Yukon Flats up to the south bank of the Yukon River, the
people in the area have been living in fear. Mr. Fleener
related that no one in the Yukon Flats supports being annexed.
He likened the proposed [Fairbanks] annexation to being
colonized by rich neighbors who see potential oil and gas
development. The [rich neighbors] want to seize that [oil and
gas] wealth from the Yukon Flats and provide little or no
services. Although the proposed annexation would leave the
majority of the Yukon Flats' communities out of the annexation,
[the people in the area] own a lot of land on the south bank of
the Yukon River. He opined that if the current LBC
[regulations] are left as they are, there will be annexation
without representation.
MR. FLEENER turned to the intent of the framers of the Alaska
Sate Constitution. He related his belief that the framers had
the notion that many Alaskans would be wealthy with things to
export from all over Alaska. However, that isn't the case. In
fact, the Yukon Flats area has the second lowest income level in
the state, and therefore the area wouldn't be able to pay the
taxes required [were the area to be annexed]. Furthermore, the
Yukon Flats is not an exporter of goods. Mr. Fleener said that
he didn't believe the notion that all [areas] should become
boroughs is a good model. He stated that the Fort Yukon area
doesn't have the revenue to support its own borough or being
included in the expansion of another borough. In conclusion,
Mr. Fleener opined that those in an area of a proposed
annexation need to have say on any such proposal.
9:45:22 AM
MR. FLEENER, in response to Representative Salmon, explained
that the area within which the Council of Athabascan Tribal
Governments works is about 55,000 square miles, including the
Venetie Reservation. Around the [55,000 square miles] is the
Yukon Flats National Wildlife Refuge, Yukon Charlie National
Park and Preserve, and some Bureau of Land Management land. He
noted that there are no roads leading into the Yukon Flats.
9:46:57 AM
FREDRICK SHEEN, President, Delta Junction Chamber of Commerce,
announced that he is in favor of SSHB 133. He informed the
committee that he is a commissioner of a borough charter
commission in Delta Junction that has just completed a charter
and is just moving toward a petition. At this point, there are
no legal grounds to stop an annexation of the Pogo gold mine,
which is a key component of the charter. Mr. Sheen related his
belief that the LBC has too much power and a vote of the people
is necessary.
9:48:23 AM
REPRESENTATIVE NEUMAN surmised that Mr. Sheen is in favor of
SSHB 133 because he feels that the area's ability to grow its
own local government would be imposed upon.
MR. FREDRICK agreed.
9:49:07 AM
DICK SHULTZ, former Senator, remarked that the system is broken
and needs to be fixed. He related his belief that Mr. Bockhorst
is part of the problem. Mr. Shultz recalled discussions and
notes with some of the survivors of the constitutional framers,
specifically Jack Coghill, which significantly differ from Mr.
Fisher's interpretation. Mr. Shultz disagreed with the earlier
testimony that [SSHB 133] is unconstitutional. In conclusion,
Mr. Shultz emphasized that SSHB 133 should move forward.
9:52:34 AM
MR. SHULTZ, in response to Representative Neuman, informed the
committee that he served in the legislature from 1982-1992. Mr.
Shultz opined that there are some good things happening in this
legislature, in particular reviewing allowing unorganized areas
to remain unorganized if they so choose. He related his belief
that the constitution clearly specifies the right for areas to
remain unorganized. Mr. Shultz turned attention to Senator
Bunde's head tax legislation, and opined that those in
unorganized boroughs would prefer to pay their fair share rather
than be included in an additional layer of government.
9:54:22 AM
MR. FISHER clarified the he didn't say or imply that all of
Alaska should become organized boroughs. He said that the
constitution, the record, and his statements have been to the
effect that Alaska is to be divided in levels of organized and
unorganized boroughs with maximum local participation.
9:55:59 AM
CO-CHAIR THOMAS closed public testimony and held SSHB 133.
HB 121-SERVICE AREAS IN SECOND CLASS BOROUGHS
9:56:16 AM
CO-CHAIR THOMAS announced that the final order of business would
be HOUSE BILL NO. 121, "An Act relating to consolidating or
abolishing certain service areas in second class boroughs."
9:56:41 AM
REPRESENTATIVE OLSON moved to report CSHB 121, Version 24-
LS0396\Y, out of committee with individual recommendations [and
the accompanying fiscal notes]. There being no objection, CSHB
121(CRA) was reported from the House Community and Regional
Affairs Standing Committee.
ADJOURNMENT
There being no further business before the committee, the House
Community and Regional Affairs Standing Committee meeting was
adjourned at 9:57:05 AM.
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