Legislature(2001 - 2002)

04/04/2001 01:45 PM CRA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                     ALASKA STATE LEGISLATURE                                                                                   
           SENATE COMMUNITY & REGIONAL AFFAIRS COMMITTEE                                                                      
                           April 4, 2001                                                                                        
                             1:45 p.m.                                                                                          
                                                                                                                                
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Senator John Torgerson, Chair                                                                                                   
Senator Alan Austerman                                                                                                          
Senator Randy Phillips                                                                                                          
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Senator Georgianna Lincoln                                                                                                      
Senator Pete Kelly                                                                                                              
                                                                                                                                
                                                                                                                              
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
SPONSOR SUBSTITUTE FOR HOUSE BILL NO. 16                                                                                        
"An Act relating to cities incorporated under state law that are                                                                
home rule communities; and providing for an effective date."                                                                    
     HEARD AND HELD                                                                                                             
                                                                                                                                
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
No previous action recorded                                                                                                     
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
Representative Fred Dyson                                                                                                       
Alaska State Capitol, Room 104                                                                                                  
Juneau, AK  99801-1182                                                                                                          
POSITION STATEMENT: Bill sponsor                                                                                              
                                                                                                                                
Kevin Ritchie                                                                                                                   
Alaska Municipal League                                                                                                         
217 2nd Street                                                                                                                  
Juneau, AK 99801                                                                                                                
POSITION STATEMENT: Testified on HB 16                                                                                        
                                                                                                                                
Glen Marunde                                                                                                                    
P.O. Box 192                                                                                                                    
Tok, AK 99780                                                                                                                   
POSITION STATEMENT: Testified on HB 16                                                                                        
                                                                                                                                
John Pearson                                                                                                                    
Hyder Community Association                                                                                                     
No address provided                                                                                                             
POSITION STATEMENT:  Testified on HB 16                                                                                       
                                                                                                                                
John Kunik                                                                                                                      
Glennallen, AK 99588                                                                                                            
POSITION STATEMENT: Testified on HB 16                                                                                        
                                                                                                                                
Tamara Cook                                                                                                                     
Director                                                                                                                        
Legislative Affairs Agency                                                                                                      
Legislative Legal and Research Services                                                                                         
State Capitol                                                                                                                   
Juneau, AK 99801-1182                                                                                                           
POSITION STATEMENT: Answered questions on HB 16                                                                               
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
TAPE 01-12, SIDE A                                                                                                            
Number 001                                                                                                                      
                                                                                                                                
CHAIRMAN  JOHN TORGERSON  called  the  Senate Community  &  Regional                                                          
Affairs  Committee  meeting  to  order  at 2:10  p.m.  Present  were                                                            
Senators, Lincoln, Austerman, Phillips and Chairman Torgerson.                                                                  
                                                                                                                                
There was one item on the agenda.                                                                                               
                                                                                                                                
                                                                                                                                
                   HB  16-HOME RULE COMMUNITIES                                                                             
                                                                                                                                
REPRESENTATIVE  FRED DYSON, bill sponsor, introduced  the bill. When                                                            
he first was elected  to the legislature, Vic Fischer  told him that                                                            
this was an important issue that needed addressing.                                                                             
                                                                                                                                
Article 10 in the Alaska  Constitution encourages self-determination                                                            
in Alaska's communities.  HB 16 allows existing second class cities,                                                            
or unincorporated  areas,  to form  a home rule  community. This  is                                                            
similar to  a second class city but  the community is able  to write                                                            
their own charter, which  allows them flexibility in determining the                                                            
scope  of their  governing  powers  and the  services  that will  be                                                            
provided.                                                                                                                       
                                                                                                                                
It is  his hope  that this  will remove  some  of the disincentives                                                             
associated  with organizing.  It should also  allow communities  the                                                            
ability to organize  a form of government that they  are comfortable                                                            
with and is more traditional and culturally appropriate.                                                                        
                                                                                                                                
He called member's  attention to the  final pages of the  "Achieving                                                            
Alaska  Native Self-Governance"  report  by The  Economics  Resource                                                            
Group,  Inc. and  The Institute  of  Social and  Economic  Research,                                                            
University  of Alaska,  Anchorage  dated May  1999.  There are  also                                                            
letters of support from  the Southeast Conference, Hyder and several                                                            
individuals including Vic Fischer and Richard Burton.                                                                           
                                                                                                                                
SENATOR LINCOLN asked how HB 16 coincides with SB 48.                                                                           
                                                                                                                                
REPRESENTATIVE   DYSON  said  his  bill  only  addresses   what  are                                                            
presently  second class  cities  and they  should still  be able  to                                                            
write  their own  charter if  they are located  in  an area that  is                                                            
incorporated  into a borough.  However, he  would defer part  of the                                                            
question to Tamara Cook when she arrives.                                                                                       
                                                                                                                                
CHAIRMAN TORGERSON asked  which disincentives this bill is trying to                                                            
correct.                                                                                                                        
                                                                                                                                
REPRESENTATIVE  DYSON said communities wouldn't be  required to have                                                            
an audit  of their  books every year  as is now  required of  second                                                            
class cities.                                                                                                                   
                                                                                                                                
CHAIRMAN TORGERSON  said whether a  second class city could  get out                                                            
of the audit requirement with public dollars.                                                                                   
                                                                                                                                
REPRESENTATIVE  DYSON  said yes,  if they  switched to  a home  rule                                                            
community.                                                                                                                      
                                                                                                                                
CHAIRMAN TORGERSON  asked if that  was in the bill or just  a result                                                            
of the bill.                                                                                                                    
                                                                                                                                
REPRESENTATIVE  DYSON said the requirement that they  do not have to                                                            
have an  audit is in the  bill but "it doesn't  say to second  class                                                            
cities you can  now switch. And of course in order  to become a home                                                            
rule community  it's got to go through  the boundary commission  and                                                            
that whole process."                                                                                                            
                                                                                                                                
In the last  few years, there have  been nearly as many communities                                                             
dissolving themselves as organizing under state law.                                                                            
                                                                                                                                
A question that  arose when similar legislation was  introduced last                                                            
year is,  "Are you  trying to  keep communities  from organizing  as                                                            
tribes?"  His answer  is no; he's  hoping many  communities will  do                                                            
both.                                                                                                                           
                                                                                                                                
SENATOR LINCOLN  asked about the economic benefits  and drawbacks to                                                            
the bill.                                                                                                                       
                                                                                                                                
Number 128                                                                                                                      
                                                                                                                                
REPRESENTATIVE  DYSON said  the major benefit  is to make it  easier                                                            
for   individuals   to  organize   for  self-determination.    Also,                                                            
communities  will be able  to organize in  ways that are  culturally                                                            
and traditionally familiar.                                                                                                     
                                                                                                                                
SENATOR LINCOLN asked for economic benefits and drawbacks.                                                                      
                                                                                                                                
REPRESENTATIVE   DYSON   said  the   advantage  is   that  a   state                                                            
organization  is provided  that Community  and Regional Affairs  can                                                            
communicate  with and funnel monies  and programs through.  It gives                                                            
the  community  status  in  state  law so  bonding  is  possible;  a                                                            
property tax of up to 2 mills may be imposed if so desired.                                                                     
                                                                                                                                
The only disadvantage  he can think of is the disadvantage  of self-                                                            
determination because responsibility is always uncomfortable.                                                                   
                                                                                                                                
CHAIRMAN  TORGERSON asked  whether this would  be available  to just                                                            
second class cities and not first class cities.                                                                                 
                                                                                                                                
REPRESENTATIVE DYSON said  first class cities may now form their own                                                            
charters. This  bill extends the privilege  to current second-class                                                             
cities.                                                                                                                         
                                                                                                                                
CHAIRMAN TORGERSON  asked what powers  might be lost if a  community                                                            
organized as home rule.                                                                                                         
                                                                                                                                
REPRESENTATIVE  DYSON said nothing  that can presently be  done as a                                                            
second-class  city would  be lost  under home  rule. Basically,  the                                                            
bill adds  "or home  rule community"  after "second  class city"  to                                                            
sections of Title 29.                                                                                                           
                                                                                                                                
CHAIRMAN TORGERSON asked for questions. There were none.                                                                        
                                                                                                                                
KEVIN RITCHIE,  from the  Alaska Municipal  League, views this  as a                                                            
positive  bill that allows  second class cities  to write their  own                                                            
charter. Community discussion and decision about effective self-                                                                
government  is a positive event and  to the extent that it  would be                                                            
an enticement to organize, this too is viewed as a benefit.                                                                     
                                                                                                                                
Another benefit  is that a home rule  community may be reclassified                                                             
as a home  rule city. It  is a reasonable  step that doesn't  change                                                            
the  requirements  or responsibilities   of communities;  it  allows                                                            
second class cities  to determine what will make their  city operate                                                            
better through formation of a charter.                                                                                          
                                                                                                                                
CHAIRMAN  TORGERSON asked  for an interpretation  of the  difference                                                            
between home rule community and home rule city.                                                                                 
                                                                                                                                
MR. RITCHIE said, "You  can have this charter but you don't have the                                                            
broad powers of  a home rule city. A home rule city,  obviously, has                                                            
any power not prohibited  to it. A second class city has only powers                                                            
not restricted by its charter"                                                                                                  
                                                                                                                                
CHAIRMAN  TORGERSON said, "You're  saying it  would have to  do with                                                            
charter  with  the  home  rule  community  also.  I  don't  see  the                                                            
difference. Can't a second  class city petition for a home rule city                                                            
now?"                                                                                                                           
                                                                                                                                
MR. RITCHIE said it could.  "The difference between a home rule city                                                            
and  a   home  rule   community  would   be  the   whole  class   of                                                            
responsibility  that comes with being  a first class or a  home rule                                                            
city."                                                                                                                          
                                                                                                                                
CHAIRMAN TORGERSON responded that it's limited by their charter.                                                                
                                                                                                                                
MR. RITCHIE said, "As limited by the charter, right."                                                                           
                                                                                                                                
CHAIRMAN  TORGERSON said you  could do that  now. He wanted  that on                                                            
the record.                                                                                                                     
                                                                                                                                
REPRESENTATIVE  DYSON said there are  two things; to be a  home rule                                                            
city there  must be  land planning  and they must  become their  own                                                            
school district.  Those  are two significant  responsibilities  that                                                            
some communities don't want to or aren't prepared to accept.                                                                    
                                                                                                                                
"Another classification,  and Tam will be able to  speak to it, they                                                            
are a general  law community unless they choose to  organize, and we                                                            
end up  being their  government.  So they  have the  chance to  have                                                            
their own  and not  have to be  governed by the  general law  rules,                                                            
right?"                                                                                                                         
                                                                                                                                
SENATOR PHILLIPS  asked Mr. Ritchie  why there wasn't a letter  from                                                            
the Alaska  Municipal League  although he  assumes they endorse  the                                                            
idea.                                                                                                                           
                                                                                                                                
MR. RITCHIE said the letter is forthcoming.                                                                                     
                                                                                                                                
SENATOR AUSTERMAN asked about joint insurance.                                                                                  
                                                                                                                                
MR. RITCHIE said  that second class cities are now  eligible to be a                                                            
member of  the joint insurance  association.  If you weren't  a city                                                            
and then became  a home rule community  you would be a municipality                                                             
under the definition  of the state law and you would  be eligible to                                                            
be served.                                                                                                                      
                                                                                                                                
GLEN MARUDE of Tok testified  in support of HB 16. He views HB 16 as                                                            
a stepping-stone toward borough formation.                                                                                      
                                                                                                                                
Number 300                                                                                                                      
                                                                                                                                
JOHN PEARSON,  Economic  Development  Planner for  the Community  of                                                            
Hyder, testified in support  of HB 16. This may be a major factor in                                                            
the further  development of the community.  The community  currently                                                            
has their own fire department,  emergency services, library, visitor                                                            
center, museum, provides  snow removal, operates a cable TV service,                                                            
maintains  a landfill,  oversees  a  state  owned boat  harbor,  was                                                            
recently approved  by the FCC for  a low power FM radio station  and                                                            
operates  a one room school.  Also, there  is a bottled water  plant                                                            
that employees 26 people  and should increase to employ 41 people by                                                            
the end of August.                                                                                                              
                                                                                                                                
This bill will give the  community the opportunity to participate in                                                            
state  bonding  programs  and  they could  also  take  advantage  of                                                            
opportunities  such as the ferry authority. Several  years ago Hyder                                                            
was  denied this  opportunity  because of  the organization  of  the                                                            
community. Under  home rule community status, they  would be able to                                                            
participate. There is incentive  to participate with Prince of Wales                                                            
to become a  member of the authority.  There are, in fact,  a number                                                            
of state  programs that they  would like to  participate in  but are                                                            
currently denied because of the community status.                                                                               
                                                                                                                                
Currently,  Hyder is doing reasonably  well economically  because of                                                            
the  bottled water  project,  a  small community  project  that  was                                                            
started  by residents  that  were looking  beyond  unemployment  and                                                            
welfare.  Two years  ago, with  their own  money and  help from  the                                                            
Economic Development Administration  (EDA) they located a market and                                                            
developed  a plant.  They are  able to  blow their  own bottles  and                                                            
manufacture   their  own  shipping   pallets  thus  providing   more                                                            
employment  opportunities.  It is  because of  this prosperity  they                                                            
fear annexation by the Ketchikan borough.                                                                                       
                                                                                                                                
                                                                                                                                
What they are doing in  Hyder is an example of what could be done in                                                            
many  communities  around  the  state.  In Southeast  there  are  13                                                            
communities  that could take advantage  of HB 16 and realistically,                                                             
three  will do so.  "We see  passage of  HB 16 as  giving Hyder  the                                                            
opportunity  to become a  bigger player in  the scheme of things  in                                                            
the State of Alaska."                                                                                                           
                                                                                                                                
CHAIRMAN TORGERSON  asked why they  don't form a second class  city.                                                            
                                                                                                                                
MR. PEARSON  said that the high cost  of surveying and platting  has                                                            
been a drawback.  He doesn't know  how the school would be  affected                                                            
but the  community didn't  think they  were ready  to form a  second                                                            
class city.                                                                                                                     
                                                                                                                                
SENATOR  LINCOLN said  that the  testifier  from Tok  called this  a                                                            
stepping-stone  toward formation of a borough. She  wondered whether                                                            
Mr. Pearson viewed it the same way.                                                                                             
                                                                                                                                
MR. PEARSON said it would  give Hyder the breathing room it needs as                                                            
a community  and if the  Ketchikan borough  annexes the area  around                                                            
Hyder that wouldn't  be a problem. They are not objecting  to living                                                            
in the neighborhood  of a  borough but they  are not prepared  to be                                                            
included in a borough.                                                                                                          
                                                                                                                                
SENATOR PHILLIPS  asked about the process whereby  they decided on a                                                            
water  bottling plant.  This  seems to  be an excellent  example  of                                                            
making something out of nothing.                                                                                                
                                                                                                                                
MR.  PEARSON said  it began  with  a call  from a  woman who  needed                                                            
100,000  gallons of  water delivered  to Detroit  on a daily  basis.                                                            
Charlie Northrip  from the Juneau  Economic Development Council  had                                                            
referred her saying  this was a man who would be interested  in such                                                            
a project.  At that time,  there was no place  in Alaska that  could                                                            
deliver that volume  of bottled water but he said  he'd come up with                                                            
a solution.                                                                                                                     
                                                                                                                                
He approached  the Economic Development Administration  and was told                                                            
they would  help with funding  if he would  develop and oversee  the                                                            
development  of the  project. He was  familiar with  Hyder and  knew                                                            
they had  a real need for  economic development  so that's  where he                                                            
began.  With $800,000,  lots of volunteer  help  and no Davis  Bacon                                                            
requirements they were  able to build the plant and begin operation.                                                            
                                                                                                                                
JOHN KUNIK from  Glennallen said he knew that a home  rule community                                                            
would not constitute  a school district but wondered  whether a home                                                            
rule city would constitute a school district.                                                                                   
                                                                                                                                
CHAIRMAN TORGERSON said it would.                                                                                               
                                                                                                                                
JOHN KUNIK  testified via teleconference  from Glennallen  and asked                                                            
whether his community  could tax the pipeline if the  ad valorem tax                                                            
a home  rule community  or  second class  city could  levy was  four                                                            
percent of assessed value rather than two percent.                                                                              
                                                                                                                                
CHAIRMAN TORGERSON responded  that they could do whatever was in the                                                            
charter.  The pipeline  can  be taxed  up to  the  amount all  other                                                            
residents are taxed, which is up to 20 mills.                                                                                   
                                                                                                                                
CHAIRMAN TORGERSON  asked Tamara Cook  whether  any powers  would be                                                            
automatically   granted to a home  rule community that would  not be                                                            
granted to an  unincorporated community or would it  depend on their                                                            
charter.                                                                                                                        
                                                                                                                                
TAMARA COOK, Director of  Legislative Legal Services, said basically                                                            
it would  be what  is in  their charter  although the  power to  tax                                                            
would  be  granted  to them  and  is  not granted  to  a  community.                                                            
Essentially, home  rule communities would operate  as a second class                                                            
city with more or less  the same restraints. The main distinguishing                                                            
points  between  operating as  second  class city  and  a home  rule                                                            
community are that when  the charter is written, it could be written                                                            
in a way that  is more restrictive and that a second  class city may                                                            
elect to  take on  the provision  of various  services and  exercise                                                            
various powers.  If a home rule community  has a strict charter,  it                                                            
takes the  power to  make decisions  about the  kinds of service  to                                                            
provide away from  the governing body and places it  in the hands of                                                            
the people  and a charter cannot be  expanded without a vote  of the                                                            
people.                                                                                                                         
                                                                                                                                
In Alaska,  we  look upon  a charter  as the  sort of  thing that  a                                                            
sophisticated  community would utilize  and in this case,  a charter                                                            
could act as a shield,  and create a form of government that is more                                                            
restrictive than a typical second class city.                                                                                   
                                                                                                                                
CHAIRMAN TORGERSON asked  what automatic powers would be included in                                                            
addition to taxation,  land entitlement and boundary  determination.                                                            
                                                                                                                                
MS. COOK said when they  file their incorporation petition they must                                                            
file the same type of information.                                                                                              
                                                                                                                                
CHAIRMAN TORGERSON  asked whether there was a land  grant that would                                                            
automatically go to the community.                                                                                              
                                                                                                                                
MS. COOK thought they are included.                                                                                             
                                                                                                                                
CHAIRMAN  TORGERSON  said, "10  percent unreserved,  unappropriated                                                             
land like  anybody else forming  up." He thought  this would  be the                                                            
case unless they are precluded by the legislature.                                                                              
                                                                                                                                
MS. COOK thought  they would be treated  the same as a second  class                                                            
city.                                                                                                                           
                                                                                                                                
CHAIRMAN TORGERSON said,  "If Hyder wanted to go right over and take                                                            
right up to  Ketchikan they could,  right?" With a chuckle,  he said                                                            
this would be an opposite land grab.                                                                                            
                                                                                                                                
He said  he knows the Local  Boundary Commission  (LBC) is  involved                                                            
but who determines the boundaries? Is it a petition to LBC?                                                                     
                                                                                                                                
MS. COOK said,  yes, there's a petition process. The  LBC ultimately                                                            
approves a petition  for incorporation of any class  of municipality                                                            
and it may also  recommend changes to a petition before  approval is                                                            
granted.                                                                                                                        
                                                                                                                                
CHAIRMAN TORGERSON returned  to the question of taxation powers that                                                            
a community could or could not charter itself out of.                                                                           
                                                                                                                                
MS. COOK agreed  that they could charter themselves  into a limit if                                                            
they chose to.                                                                                                                  
                                                                                                                                
CHAIRMAN   TORGERSON  said   if  taxation   is  a   power  that   is                                                            
automatically granted, what about zoning powers?                                                                                
                                                                                                                                
MS. COOK said  that second class cities are currently  permitted but                                                            
not required to zone. It  depends upon whether they are in a borough                                                            
that is exercising the zoning power.                                                                                            
                                                                                                                                
Assuming  you are dealing  with a second class  city that is  not in                                                            
that situation, it is not  obligated to zone, and because of the way                                                            
HB 16 is drafted,  neither would home rule communities.  The charter                                                            
of a home rule community  could say it was or was not going to zone.                                                            
                                                                                                                                
CHAIRMAN TORGERSON said schools would not be an issue.                                                                          
                                                                                                                                
MS. COOK agreed there couldn't be a school district.                                                                            
                                                                                                                                
CHAIRMAN TORGERSON  asked whether  a mayor and council or  some form                                                            
of leadership would be required.                                                                                                
                                                                                                                                
MS. COOK said  yes, the Alaska Constitution requires  a city to have                                                            
a council and a borough have an assembly.                                                                                       
                                                                                                                                
CHAIRMAN TORGERSON  asked whether there is a potential  problem with                                                            
elections if the leadership is able to choose their own titles.                                                                 
                                                                                                                                
MS. COOK  does not  see selecting  a name as  a legal problem.  Home                                                            
rule communities  created under  HB 16 are  subject to the  existing                                                            
provisions that apply to  home rule municipalities and they are also                                                            
subject to limitations that apply to second class cities.                                                                       
                                                                                                                                
CHAIRMAN  TORGERSON  asked whether  they  would be  responsible  for                                                            
their own elections.                                                                                                            
                                                                                                                                
MS. COOK said they would operate their own elections.                                                                           
                                                                                                                                
CHAIRMAN TORGERSON  said that is just like a second  class city does                                                            
now.                                                                                                                            
                                                                                                                                
MS. COOK  agreed. For  example, if  a home rule  community said,  in                                                            
their charter, the community  may not conduct an election, the state                                                            
has no  requirement to  do it for  the community  so such a  charter                                                            
would be self defeating  because there would be no one to conduct an                                                            
election.                                                                                                                       
                                                                                                                                
SENATOR LINCOLN asked Ms.  Cook to outline the economic benefits and                                                            
drawbacks in having a home rule community.                                                                                      
                                                                                                                                
MS. COOK  asked if she  wanted a comparison  between other  kinds of                                                            
communities or as opposed to non-incorporated status.                                                                           
                                                                                                                                
SENATOR LINCOLN said either.                                                                                                    
                                                                                                                                
MS. COOK  said the  great economic  benefit would  be that once  you                                                            
have an organized  municipality, that  municipality qualifies  for a                                                            
number of  programs for municipal  aid. There  is also aid  given to                                                            
unincorporated  communities and it is possible that  they would have                                                            
to give up  that aid but, overall,  they would probably qualify  for                                                            
more aid  programs  if they were  incorporated.  Most programs  that                                                            
provide  aid  to  unincorporated  communities   have  an  offsetting                                                            
program that  provides aid  to a municipality  of the same  size. In                                                            
some cases,  a community  would be substituting  its unincorporated                                                             
aid for its  city aid. Generally though,  it would be in  a position                                                            
to get more aid.                                                                                                                
                                                                                                                                
To the  extent that the  state is more involved  in contracting  for                                                            
the provision of services  with local governments, an unincorporated                                                            
city with municipal standing  would be in a better situation to take                                                            
advantage of some of those contract opportunities.                                                                              
                                                                                                                                
CHAIRMAN  TORGERSON asked  whether  home rule  communities would  be                                                            
able to vote to bond themselves or enter into revenue bonding.                                                                  
                                                                                                                                
MS. COOK said they would;  a municipality of the state has the right                                                            
to incur  formal  debt, both  revenue  bonds and  bond anticipation                                                             
notes and general obligation bonds upon a vote of the people.                                                                   
                                                                                                                                
SENATOR  PHILLIPS added  that  they would  also participate  in  the                                                            
municipal bond band.                                                                                                            
                                                                                                                                
MS. COOK agreed.                                                                                                                
                                                                                                                                
CHAIRMAN TORGERSON  remarked that  those were all positive  aspects.                                                            
                                                                                                                                
He asked  whether  there were  differences  between  a charter  that                                                            
would create  a home  rule city and  a charter  that would create  a                                                            
home rule  community or does  the difference  arise from the  powers                                                            
that are adopted in the charter.                                                                                                
                                                                                                                                
MS. COOK said it's just  the powers they adopt in their charter that                                                            
will create the  difference. "However, there are some  things in the                                                            
statutes  that  now are  required  of  home rule  cities  that  have                                                            
exempted  these communities  from those provisions  in this  draft."                                                            
Examples  are,  being  a school  district  and  the  requirement  of                                                            
providing  for planning and  zoning which now  applies to home  rule                                                            
municipalities  but will be  permitted but  not mandatory for  these                                                            
types of communities.                                                                                                           
                                                                                                                                
CHAIRMAN  TORGERSON  asked  who would  settle  planning  and  zoning                                                            
disputes in Hyder since  it would be a community without overlapping                                                            
governmental powers from a borough.                                                                                             
                                                                                                                                
MS. COOK  said  that if they  have no  planning  and zoning  powers,                                                            
there are no planning and zoning issues.                                                                                        
                                                                                                                                
SENATOR  LINCOLN asked  about any  disadvantages to  the state  as a                                                            
whole to having home rule communities.                                                                                          
                                                                                                                                
MS. COOK  could not  think of  any disadvantages.  Most communities                                                             
that  might elect  to become  a home  rule community  could  already                                                            
become a second class city  if they so elected. Therefore, the state                                                            
would not  be in  a different position  with respect  to setting  up                                                            
home rule communities than it is right now.                                                                                     
                                                                                                                                
SENATOR LINCOLN  asked why the committee  wouldn't want to  adopt HB
16 after hearing the testimony that was heard today.                                                                            
                                                                                                                                
MS. COOK asked if the question was directed at her.                                                                             
                                                                                                                                
SENATOR LINCOLN  said, "If  you've got an  answer to that that'd  be                                                            
fine."                                                                                                                          
                                                                                                                                
CHAIRMAN TORGERSON  didn't know that  it was a question,  it sounded                                                            
like a statement.                                                                                                               
                                                                                                                                
MS. COOK said she represents a policy neutral agency.                                                                           
                                                                                                                                
CHAIRMAN  TORGERSON  asked  whether home  rule  community  formation                                                            
might lead to conflicts with prior LBC determinations.                                                                          
                                                                                                                                
Side B                                                                                                                          
                                                                                                                                
MS. COOK  thought the LBC  would look at  an incorporation  petition                                                            
the same way  they do now, which is  on a case-by-case basis.  There                                                            
would be  a requirement  to submit  the proposed  home rule  charter                                                            
with  the incorporation  petition  so  the LBC  will  know what  the                                                            
charter would  look like before they must decide whether  or not the                                                            
incorporation  question  should be  presented  to the  people for  a                                                            
vote. They  would be able  to decide whether  the community  has the                                                            
economic  ability and social  cohesiveness  to provide some  form of                                                            
valuable municipal local government.                                                                                            
                                                                                                                                
CHAIRMAN TORGERSON   asked how revenue  sharing would be  determined                                                            
for an unincorporated community  located in a borough that wanted to                                                            
change and has  either a high raw fish tax or high   payment in lieu                                                            
of taxes (PILT) payment from the federal government.                                                                            
                                                                                                                                
MS. COOK  presumes that it  would be the same  way as with  a second                                                            
class city.  This bill directs  the drafting  of an additional  bill                                                            
that  brings all  other  statutes  into conformity  and  also  gives                                                            
direction to treat  home rule communities as second  class cities in                                                            
any provision addressing second class cities.                                                                                   
                                                                                                                                
CHAIRMAN  TORGERSON   isn't  sure   there  is  a  determination   on                                                            
unorganized   boroughs  distributing   PILT  money  but   home  rule                                                            
communities  would have  a claim  on any  shared  revenues from  any                                                            
source.                                                                                                                         
                                                                                                                                
MS.  COOK'S understanding  of  PILT money  is  that it  is going  to                                                            
organized cities  in the unorganized boroughs. Communities  that are                                                            
in the  unorganized  borough would  qualify for  PILT money  because                                                            
they would become organized cities.                                                                                             
                                                                                                                                
CHAIRMAN TORGERSON  is assuming the LBC won't let  these communities                                                            
take in a great  deal of federal land  but asked whether  there is a                                                            
way to keep a  community from filing for more land  than is feasible                                                            
for them to manage.                                                                                                             
                                                                                                                                
MS. COOK said  the only thing she is aware of is the  LBC process of                                                            
accepting,  rejecting or rewriting  a petition.  She isn't  sure how                                                            
the LBC reaches their decisions.                                                                                                
                                                                                                                                
CHAIRMAN TORGERSON  said he is more  comfortable with the  bill than                                                            
at the beginning  of the  meeting but it will  be held in  committee                                                            
until a few more questions are answered.                                                                                        
                                                                                                                                
The meeting was adjourned at 3:00 p.m.                                                                                          
                                                                                                                                
                                                                                                                                

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