02/20/2024 01:30 PM Senate COMMUNITY & REGIONAL AFFAIRS
| Audio | Topic |
|---|---|
| Start | |
| SR3 | |
| Presentation(s): Challenges in Rural Communities | |
| Adjourn |
+ teleconferenced
= bill was previously heard/scheduled
| *+ | SR 3 | TELECONFERENCED | |
| + | TELECONFERENCED |
ALASKA STATE LEGISLATURE
SENATE COMMUNITY AND REGIONAL AFFAIRS STANDING COMMITTEE
February 20, 2024
1:29 p.m.
DRAFT
MEMBERS PRESENT
Senator Forrest Dunbar, Chair
Senator Donald Olson, Vice Chair
Senator Elvi Gray-Jackson
Senator Jesse Bjorkman
MEMBERS ABSENT
Senator Cathy Giessel
COMMITTEE CALENDAR
SENATE RESOLUTION NO. 3
Recognizing March 2024 as Chronic Kidney Disease Awareness Month
in Alaska to raise awareness of the need for research, screening
programs, and access to care for individuals who suffer from
chronic kidney disease.
- HEARD & HELD
PRESENTATION(S): CHALLENGES IN RURAL COMMUNITIES
- HEARD
PREVIOUS COMMITTEE ACTION
BILL: SR 3
SHORT TITLE: CHRONIC KIDNEY DISEASE AWARENESS MONTH
SPONSOR(s): SENATOR(s) GRAY-JACKSON
01/24/24 (S) READ THE FIRST TIME - REFERRALS
01/24/24 (S) CRA
02/20/24 (S) CRA AT 1:30 PM BELTZ 105 (TSBldg)
WITNESS REGISTER
BESSE ODOM, Staff
Senator Elvi Gray-Jackson
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Answered questions during the discussion of
SR 3.
NILS ANDREASSEN, Executive Director
Alaska Municipal League
Juneau, Alaska
POSITION STATEMENT: Introduced the top of challenges facing
rural communities and the responsibilities and resources of
local governments.
LAYTON LOCKETT, Manager
City of Adak
Adak, Alaska
POSITION STATEMENT: Discussed the challenges facing rural
communities and the responsibilities and resources of local
governments.
MARK SPRINGER, Mayor
City of Bethel
Bethel, Alaska
POSITION STATEMENT: Discussed the challenges facing rural
communities and the responsibilities and resources of local
governments.
SOPHIE SWOPE, Vice Mayor
City of Bethel
Bethel, Alaska
POSITION STATEMENT: Discussed the challenges facing rural
communities and the responsibilities and resources of local
governments.
ELLA SAM, Mayor
City of Hughes
Hughes, Alaska
POSITION STATEMENT: Discussed the challenges facing rural
communities and the responsibilities and resources of local
governments.
JUNE BEETUS WALKER, Representing Self
Hughes, Alaska,
POSITION STATEMENT: Discussed the infrastructure and service
improvement needs of the City of Hughes.
JOSEPH AMIK, City Administrator
City of Napaskiak
Napaskiak, Alaska
POSITION STATEMENT: Discussed the challenges facing rural
communities and the responsibilities and resources of local
governments.
DICKIE MOTO, Mayor
Northwest Arctic Borough
Kotzebue, Alaska
POSITION STATEMENT: Discussed the challenges facing rural
communities and the responsibilities and resources of local
governments.
SAM CHANAR, Mayor
City of Toksook Bay
Toksook Bay, Alaska
POSITION STATEMENT: Discussed the challenges facing rural
communities and the responsibilities and resources of local
governments.
GABRIEL NANOK, City Administrator
City of Chevak
Chevak, Alaska
POSITION STATEMENT: Discussed the challenges facing rural
communities and the responsibilities and resources of local
governments.
JOSH VERHAGEN, Mayor
City of Nenana
Nenana, Alaska
POSITION STATEMENT: Discussed the challenges facing rural
communities and the responsibilities and resources of local
governments.
MARY SWAIN, Presiding Officer
Bristol Bay Borough Assembly
Bristol Bay, Alaska
POSITION STATEMENT: Discussed the challenges facing rural
communities and the responsibilities and resources of local
governments.
KALEB WESTFALL, City Council Member
City of Dillingham
Dillingham, Alaska
POSITION STATEMENT: Discussed the challenges facing rural
communities and the responsibilities and resources of local
governments.
KATHY LEARY, City Manager
Gustavus, Alaska
POSITION STATEMENT: Discussed the challenges facing rural
communities and the responsibilities and resources of local
governments.
ACTION NARRATIVE
1:29:25 PM
CHAIR FORREST DUNBAR called the Senate Community and Regional
Affairs Standing Committee meeting to order at 1:29 p.m. Present
at the call to order were Senators Gray-Jackson, Bjorkman,
Olson, and Chair Dunbar.
SR 3-CHRONIC KIDNEY DISEASE AWARENESS MONTH
1:30:46 PM
CHAIR DUNBAR announced the consideration of SENATE RESOLUTION
NO. 3 Recognizing March 2024 as Chronic Kidney Disease Awareness
Month in Alaska to raise awareness of the need for research,
screening programs, and access to care for individuals who
suffer from chronic kidney disease.
He said that this is the introductory hearing of SR 3. The
intention is to have committee discussion and hear public
testimony. He invited Senator Gray-Jackson to put herself on
record and introduce her resolution.
1:31:15 PM
SENATOR GRAY-JACKSON, speaking as sponsor, introduced SR 3. She
read the following sponsor statement:
[Original punctuation provided.]
The impact kidney disease has on patients and our
healthcare system cannot be understated. To put it in
perspective, there are more than 40 million people in
the United States with kidney disease. This is roughly
equivalent to the entire population of California.
Even worse, more people will die from kidney disease
this year than breast or prostate cancer.
1:32:16 PM
Chronic kidney disease (CKD) is often asymptomatic in
the beginning making early detection a challenge.
Alaska has many high-risk populations. The high-risk
ethnicities in Alaska include African Americans,
Hispanics, Asian Americans, Pacific Islanders, and
Alaska Natives and Native Americans. Another at-risk
group includes individuals aged 65 and older, which
make up nearly 14 percent of our population. Those
living with kidney disease face challenges on many
different fronts. Whether it is accessing a donor
kidney for transplant, choosing between home or in-
clinic dialysis while juggling a job or family
responsibilities, or the constellation of challenges
for this population adds an additional layer of stress
to an already challenging chronic condition. A further
complication for those suffering from chronic kidney
disease is a lack of health insurance which results in
lack of care and poorer health outcomes compared to 8
percent average nationwide. Nearly 13 percent of our
population under the age of 65 are underinsured.
Senate Resolution 3 seeks to reduce the impact of
chronic kidney disease by increasing awareness and
screening.
1:34:04 PM
CHAIR DUNBAR invited questions from committee members.
1:34:13 PM
SENATOR OLSON asked about the prevalence of chronic kidney
disease and the number of people with kidney failure.
SENATOR GRAY-JACKSON deferred the question to her staff, Ms.
Odom.
1:34:28 PM
BESSE ODOM, Staff, Senator Elvi Gray-Jackson, Alaska State
Legislature, Juneau, Alaska, replied that the answer is a little
hard to define. Kidney disease is not a medical issue that the
state actively or aggressively tracks compared to other
conditions, such as cancer, heart disease, or stroke. She said
that she does not necessarily have those numbers, but there are
over 600 Alaskans with chronic kidney disease who require
dialysis treatment.
SENATOR OLSON asked about the breakdown of that population,
specifically the proportion of Alaska Natives and non-Alaska
Natives.
MS. ODOM replied that she does not have the breakdown but will
gather that data for the committee.
SENATOR OLSON asked whether the type of dialysis treatment is
peritoneal dialysis, administered through the abdomen, or renal
dialysis, administered through a shunt in the wrist or arm.
MS. ODOM answered that the facility administers the treatment
through a dialysis port.
1:36:08 PM
CHAIR DUNBAR asked if there were further questions and found
none. He opened public testimony on SR 3; finding none, he
closed public testimony.
CHAIR DUNBAR held SR 3 in committee.
1:36:56 PM
SENATOR GRAY-JACKSON thanked the committee for hearing the
resolution.
1:37:04 PM
At ease.
^PRESENTATION(S): CHALLENGES IN RURAL COMMUNITIES
PRESENTATION(S): CHALLENGES IN RURAL COMMUNITIES
1:37:42 PM
CHAIR DUNBAR reconvened the meeting and announced a presentation
organized by Nils Andreassen from the Alaska Municipal League
(AML) on the challenges facing communities and the
responsibilities and resources of local governments.
1:37:58 PM
NILS ANDREASSEN, Executive Director, Alaska Municipal League,
Juneau, Alaska, organized a group of local government officials
to discuss the challenges rural communities face and the
responsibilities and resources of local governments. He
emphasized the importance of hearing directly from local
government officials and that AML represents 165 local
governments, cities, and boroughs in organized areas of the
state and the unorganized borough.
MR. ANDREASSEN stressed the importance that the committee
understand the on-the-ground perspectives of local governments.
This understanding is crucial as committee members decide on
budgets and bills affecting residents statewide. AML's role is
to bring together local governments to listen, learn, and
coalesce around shared priorities and common issues and advocate
for these issues to state policymakers. He noted that the best
advocates for communities are the communities themselves. He
said each local government representative prepared brief remarks
about their challenges and what is important for committee
members to understand.
1:40:10 PM
CHAIR DUNBAR noted that the legislature is considering several
bills related to taxable property, such as those affecting farm
property, nonprofits, and tax exemptions. He expressed interest
in hearing from local government representatives about their
funding mechanisms, specifically whether their communities rely
on property taxes or have other primary sources of revenue.
1:40:54 PM
MR. ANDREASSEN said that he has gathered feedback on those bills
from AML members over the past few months and has wrestled with
these questions. He emphasized that the best taxes are broadly
applied. The broader the tax base, the more equitably it is
implemented. This means fewer exemptions are preferable, as they
ensure the tax is applied evenly across the community. However,
he noted the significant variation among communities, indicating
that a one-size-fits-all approach is not feasible.
MR. ANDREASSEN said that the majority of communities do not have
a property tax. Property tax applies to many within boroughs.
Sales tax is the most common revenue source; one hundred six
local governments have implemented one. Communities with fish
taxes, either landing or business, are critically impacted by
the activities in those sectors.
MR. ANDREASSEN highlighted that any reduction in available
revenues affects funding for education, public safety, and other
economic and community development activities within a
jurisdiction. He said that he looked forward to hearing from
communities on the topic.
1:42:51 PM
CHAIR DUNBAR announced the first invited government official and
asked him to put himself on the record and begin his testimony.
1:43:21 PM
LAYTON LOCKETT, Manager, City of Adak, Adak, Alaska, discussed
the challenges facing rural communities and the responsibilities
and resources of local governments. Adak primarily generates
revenue through the sale of raw seafood or fish tax, mainly
shared through the state. The fishing industry generates a lot
of revenue for Adak.
1:43:51 PM
MR. LOCKETT said that due to the composition of Adak and its
generation as a second-class city through the closure of the
Naval Air Facility Adak (NAF-Adak), the community was not
appropriately surveyed. A property tax would require a
comprehensive survey of land transferred into private hands,
which would be costly without federal support. He mentioned that
Adak has been managing its way through the infrastructure left
behind by the U.S. Navy over twenty years ago. The difficulties
include:
• Obtaining safe water.
• Maintaining a power supply.
• Overseeing two hundred million dollars worth of property,
which was transferred to the city, on a city operating budget
of $1 million.
MR. LOCKETT noted an impending substantial increase in the cost
of power due primarily due to an antiquated electrical
distribution system. Adak will soon be paying over $2 per
kilowatt-hour for residential power before power cost
equalization (PCE) which is already at the statutory maximum.
1:45:10 PM
MR. LOCKETT mentioned the challenges Adak faces trying to right-
size, working with federal agencies and State agencies to obtain
administrative support. This is particularly difficult with the
Alaska Department of Fish and Game (ADF&G) and the Department of
Environmental Conservation (DEC). As Adak navigates the new
Environmental Protection Agency (EPA) rule requiring a lead
service line inventory (LSL), it must address thousands of
buildings technically connected without as-built records. The
resources provided by DEC are insufficient to undertake this
task privately. Despite these obstacles, Adak is doing its best
with the available resources.
1:46:05 PM
SENATOR GRAY-JACKSON asked about Adak's population.
MR. LOCKETT replied that the official population of Adak is 330,
although the current unofficial population is at or below 100.
1:46:26 PM
CHAIR DUNBAR asked why the population is officially 330 but
unofficially only 100.
MR. LOCKETT replied that when the U.S. Census Bureau conducted
the census, it counted many of the shore-based fish processing
plant workers. The plant was in operation, and the census
counted many of the workers. Another factor that contributed to
the higher population was the federal cleanup contracts related
to the Comprehensive Environmental Response, Compensation, and
Liability Act (CERCLA). Since the census, the fish plant has
closed, and Adak now has a larger transient population due to
tourism or ship-to-ship transfers. Due to a lack of industry,
Adak's resident population has decreased.
1:47:16 PM
SENATOR OLSON asked about the number of children that attend
school in Adak.
MR. LOCKETT answered that the school closed this year because
Adak has zero children on the island. Since the city owns the
municipal building and the school is located within, the closure
only involved locking a few classroom doors. Still, it maintains
the remainder of the building for various operations. He likened
it to Whittier, explaining that Adak could reopen the school
tomorrow if there were children as the rooms are ready to go.
SENATOR OLSON asked about ownership of the airport.
MR. LOCKETTE replied that the Department of Transportation and
Public Facilities (DOTPF) owns it.
SENATOR OLSON sought clarification on whether the federal
government had transferred the airport to the State.
MR. LOCKETTE answered yes.
1:48:13 PM
CHAIR DUNBAR thanked Mr. Lockett, noting that Adak is a
fascinating community with a fascinating history and unique
challenges.
1:49:03 PM
MARK SPRINGER, Mayor, City of Bethel, Bethel, Alaska, discussed
the challenges facing rural communities and the responsibilities
and resources of local governments.
1:49:21 PM
SOPHIE SWOPE, Vice Mayor, City of Bethel, Bethel, Alaska,
discussed the challenges facing rural communities and the
responsibilities and resources of local governments.
1:49:34 PM
MR. SPRINGER said that Ms. Swope is a lifelong resident of
Bethel and brings a unique perspective to the discussion.
MR. SPRINGER addressed Bethel's funding mechanisms, specifically
property taxes and other sources of revenue. He said that Bethel
is the best-kept secret in Alaska real estate. A new house costs
around $700,000. He explained that Bethel has no property tax,
so there are no carrying costs once the owner boards it up,
drains it, and turns off the electricity. Bethel generates
revenue through a 6 percent sales tax, a 50 percent sales tax on
marijuana and alcohol, and a 45 percent excise tax on tobacco
products.
MR. SPRINGER highlighted several challenges faced by Bethel. He
said the community has a population of about 6,000 and is a
second-class city. Bethel does not exercise any education powers
and is part of the Lower Kuskokwim School District (LKSD),
Regional Educational Attendance Area (REAA). The city is
responsible for water and sewer services, maintaining a mix of
piped and hauled systems. The city maintains approximately 25
miles of roads, with the central artery being a state highway
maintained by the DOTPF. Bethel has public safety, police, and a
fire department but no health powers.
1:50:53 PM
MR. SPRINGER said several of Bethel's core issues are:
Housing
There is not enough housing, and it is expensive. When the
Yukon-Kuskokwim Health Corporation (YKHC) built the new
hospital, the arrival of 400 health professionals significantly
drove up real estate prices, making housing unaffordable for
young families. This is a factor in the difficulty of filling
positions; there are a lot of job openings in Bethel.
Infrastructure
Infrastructure is a major concern. Buildings in Bethel as well
as in other communities around the state, were constructed in
the 1970s and 1980s, community halls, police stations, and water
and sewer systems. Construction costs have nearly doubled since
2020. Bethel went out to bid for a new water and sewer system.
The city received one proposal that was double the city's
estimated cost.
1:53:06 PM
SENATOR GRAY-JACKSON asked about Bethel's population and budget.
MR. SPRINGER replied that Bethel's population is around 6,000,
and the budget is around $25,000,000.
1:53:25 PM
CHAIR DUNBAR asked whether Bethel has zoning.
MR. SPRINGER replied that it does. Bethel's zoning is based more
on the type of use than the size of a house on a lot. Bethel
does not have zoning regulations restricting the size of houses
on lots, so people can build almost anything they want on their
house lot.
CHAIR DUNBAR asked if someone could build a multi-family home in
Bethel, which is an issue in Anchorage right now.
MR. SPRINGER replied yes, certainly.
1:54:03 PM
SENATOR OLSON asked which utility provides Bethel's electricity.
MR. SPRINGER replied that Bethel is now an Alaska Village
Electric Cooperative (AVEC) member.
SENATOR OLSON sought confirmation that AVEC provides the power.
MR. SPRINGER replied yes.
SENATOR OLSON asked whether Bethel has a village public safety
officer (VPSO) who provides public safety.
MR. SPRINGER replied that Bethel has its own police department.
SENATOR OLSON sought confirmation that there are no VPSOs in
Bethel.
MR. SPRINGER replied that there are no VPSOs in Bethel.
1:54:18 PM
SENATOR OLSON recalled that Hooper Bay had a police department
and a VPSO.
MR. SPRINGER replied that is correct. Sometimes, there was a
VPSO, a police department, and sometimes both.
1:54:32 PM
CHAIR DUNBAR invited Vice Mayor Swope to testify.
1:54:33 PM
MS. SWOPE said that besides serving as the vice mayor for the
City of Bethel, she also serves on the Orutsararmiut Traditional
Native Council, which is the tribe in Bethel. She said that
working with both government organizations, she has noticed the
transient nature of many employment opportunities in Bethel.
This is particularly true in healthcare at YKHC and in law
enforcement. The community lacks the structure needed for stable
police enforcement.
She said that over the past two years, she has observed a
significant rise in the use of drugs such as heroin, fentanyl,
and other opioids. Access to Narcan would provide substantial
relief to the community. The community has experienced numerous
overdoses, which often necessitate costly medevac services to
Anchorage. Addressing this issue would greatly benefit Bethel's
families.
1:56:20 PM
CHAIR DUNBAR asked whether Narcan is available through YKHC, and
if Bethel has a fire department. He said the Anchorage Fire
Department administers Narcan.
MS. SWOPE replied yes. Bethel has a fire department with
emergency medical services (EMS).
1:56:36 PM
MR. SPRINGER interjected, stating that YKHC has Narcan and
understood it is available across the counter. He commented that
at a Saturday market, public health nursing distributed opioid
rescue kits. The kit contained two NARCAN nasal sprays, a pair
of gloves, and some instructions inside a little canvas bag. He
said public health nursing has them available in quantity.
1:58:00 PM
ELLA SAM, Mayor, City of Hughes, Hughes, Alaska, discussed the
challenges facing rural communities and the responsibilities and
resources of local governments. She said the City of Hughes
lost its chief and mayor, a great person. She expressed that she
is filling in for him and will try to make good on her
testimony.
1:58:27 PM
CHAIR DUNBAR sought confirmation that the name of the recently
departed mayor was Mr. Beetus.
MS. SAM affirmed Mr. Beetus was the former mayor and she
introduced his sister, Ms. Walker.
1:58:31 PM
JUNE BEETUS WALKER, representing self, Hughes, Alaska, discussed
the infrastructure and service improvement needs of the City of
Hughes.
1:58:35 PM
CHAIR DUNBAR said that it was good to see Ms. Walker again.
1:58:40 PM
MS. SAM said the City of Hughes has a population of 92, and the
city has 35 students. She said she had a "wish list," which
outlined the infrastructure and service improvement needs of the
City of Hughes as follows:
Water and Sewer Upgrade
• Winter Challenges: This past winter, the community faced
numerous issues with frozen water lines.
• Equipment and Personnel Issues: The mayor and chief were the
only ones who knew the location of the equipment. This led to
inefficiencies as people searched for tools. Meanwhile,
temperatures plummeted to around 60 degrees below zero.
• Impact on Homes: More than a couple of homes had frozen water
lines and leaks, causing a lot of work during the extreme cold
weather.
Septic System Sanitation Concern
• No Pumping Truck: The community lacks a septic pumping and
hauling truck, resulting in unpumped septic tanks.
Housing Rehabilitation
• Home Repairs: 21 homes need to be rehabilitated. Older homes
built from logs have frozen water pipes and foundation erosion
issues.
• Raven Subdivision Development: Plans to develop the new
subdivision are underway. The city needs help surveying,
planning, and constructing up to 14 single-family home lots.
2:01:12 PM
Biomass Boiler Rehabilitation
• The interior of the biomass boiler facility burned. The city
needs funding to rehabilitate the facility.
School Gymnasium
• The City of Hughes has a half-court gym built in 1969-70,
which is too small to accommodate the growing student
population. A full-court gym is needed to serve the students
better.
Solar Panels
• The city would like solar panels that face east and west at
the existing solar panel site to provide sufficient power for
the entire village.
Elder Assisted Living Home
• A local assisted living home is needed to keep elders at home
in their community. Currently, elders are sent to the Denali
Center in Fairbanks for care. After spending their lives
caring for their community, sending them away is
disheartening.
Birch Hill New Bridge and Road Maintenance
• The bridge is over a running creek at the bottom of a hill.
The bridge washes away every year yet remains in use. A new
bridge and road maintenance are needed to remedy that problem.
New Water Plant
• The existing water plant, built in the 1960s, needs
replacement.
MS. SAM said that this is a big wish list.
2:03:36 PM
MS. WALKER requested permission to comment on the City of
Hughes.
2:03:40 PM
CHAIR DUNBAR said yes, of course, and invited Ms. Walker to
testify.
2:03:45 PM
MS. WALKER expounded on the City of Hughes' needs. She said the
existing water and sewer service was part of a 20-year-old pilot
project. It is not working as well as it should, so the
community would like it upgraded. She spoke to the 21 homes in
need of rehabilitation, stating that many were built as
temporary housing in the 1980s after a flood, yet people still
live in them today. An engineer from Anchorage did a lot of the
planning for the Raven Subdivision. The plan is for 14 lots
because Hughes is growing. She said the community gets only 13-
15 percent of its power from its solar panels. With funding to
purchase panels that face east and west, the amount of power
supplied to the city could increase to around 50 percent.
2:05:33 PM
SENATOR GRAY-JACKSON thanked Ms. Sam for sharing her "wish
list," stating that it is more like a quality-of-life list that
urban communities take for granted. She asked about the city
budget and revenue sources.
MS. WALKER replied that she was unsure; it was more than a
million dollars.
SENATOR GRAY-JACKSON asked that the city gather that information
for the committee.
MS. SAM said that she is trying to do the best possible with the
information available. She said that though she sits on the city
council, the city administrator was supposed to attend this
hearing but was called away on other business.
2:06:34 PM
SENATOR GRAY-JACKSON asked what the city's source of revenue are
and where the city gets its funding.
MS. WALKER replied that the city had a pilot project to build a
new road to the cemetery this summer. Previously, people had to
climb a hill with all the necessary equipment for burial. The
project employed and trained young people to build the road,
with around 45 participants involved. Participants came from
local villages. The State gave the city about $4 million.
2:07:32 PM
SENATOR GRAY-JACKSON asked how the budget is funded, wondering
whether it is funded through fish tax.
MS. WALKER replied that Hughes owns its electric plant and some
heavy equipment used for construction.
2:07:56 PM
CHAIR DUNBAR inquired about ownership of the Raven Subdivision
land.
MS. SAM replied that the city does.
CHAIR DUNBAR asked whether the State donated that land to the
city or if the City of Hughes owned it for a long time.
MS. WALKER replied that the city always owned the land.
CHAIR DUNBAR sought confirmation that it was part of the
original incorporation of the city.
MS. SAM said that the State owns the airport and explained that
Raven Subdivision is further back, near a little slough.
CHAIR DUNBAR commented that the subdivision is a great use of
municipal land.
2:09:31 PM
JOSEPH AMIK, City Administrator, City of Napaskiak, Napaskiak,
Alaska, discussed the challenges facing rural communities and
the responsibilities and resources of local governments. He said
Napaskiak is a small community of 450 people made up of 99
percent Natives. Napaskiak has winter roads that connect to
Bethel and nearby villages. The school has about 280 students.
The city and tribal governments collaborate to help with
Napaskiak's infrastructure.
MR. AMIK said he wanted to come to Juneau to share the
challenges facing his community, including:
Law Enforcement
• The community lacks sufficient funding for law enforcement.
Despite exploring various federal grants, obtaining them
remains challenging.
• Due to the legalization of marijuana and alcohol in Bethel,
Napaskiak has experienced an increase in alcohol-related
crimes, including domestic violence. Although there is no road
system, residents use skiffs in the summer and snowmobiles in
the winter to commute to Bethel to make these purchases.
• The community is desperate for more law enforcement. A 3
percent sales tax generates revenue to fund law enforcement.
The city can employ two village police officers with tax
revenues. The tribal government employs up to six, but given
the crime rate, this is insufficient.
• Both city and tribal police officers have high turnover rates
due to the high crime rate and challenging work conditions.
2:13:48 PM
Waste Heat System
• Napaskiak has a new waste heat system due to start up in June.
The power company will utilize the waste heat from the power
plant generators to heat multiple public buildings.
• The location of City Hall must be closer to the new waste heat
system to benefit from it. Relocating it would save on heating
costs. Currently, heating fuel in Napaskiak costs close to $8
a gallon due to barge delivery, compared to $3 - $4 in
Anchorage. Despite the Payments in Lieu of Taxes (PILT)
program and Community Assistance Program (CAP) funding,
heating costs pose a challenge.
Insurance Costs
• The cost of building insurance rises every year, increasing by
over $30,000 in the past 10-15 years. This increase poses a
challenge given the community's fixed PILT and CAP funds. The
rising costs have affected city employees and council members,
who now work fewer hours per week.
Revenue Generation
• The community needs to explore ways to generate more revenue
to address these challenges.
2:16:30 PM
CHAIR DUNBAR asked from where PILT funds come.
MR. AMIK replied that PILT comes from the State of Alaska,
revenue-sharing.
CHAIR DUNBAR expressed his understanding that PILT is associated
with some kind of facility, like an Army facility. He sought
clarification about whether a State facility is paying PILT or
if it is just a direct payment.
MR. AMIK replied that it is a payment that goes through AML.
Napaskiak gets those funds annually at the end of the fiscal
year in June or July.
2:17:13 PM
SENATOR GRAY-JACKSON asked about Napaskiak's budget and revenue
sources. She said funding communities without a sufficient
revenue stream is challenging, so she asks every community these
questions. She recalled that Napaskiak has a sales tax that pays
for law enforcement.
MR. AMIK replied that the city submits CAP fund applications
but, with the exception of funds for administrative personnel,
heating, water, and sewer bills, the city receives no funding.
He said that the city has a 2 percent sales tax to fund local
law enforcement.
SENATOR GRAY-JACKSON inquired about the city's annual budget.
MR. AMIK replied that the city gets $86,000 from the CAP alone.
2:18:55 PM
DICKIE MOTO, Mayor, Northwest Arctic Borough, Kotzebue, Alaska,
discussed the challenges facing rural communities and the
responsibilities and resources of local governments. He said the
Northwest Arctic Borough consists of eleven communities. The
borough faces the challenge of aging infrastructure every day.
The borough prioritizes public safety, including fire service,
search and rescue, and VPSOs. He recounted a recent tragic
experience. A fire in one of the villages claimed six lives in
one house. This heightened the borough's focus on improving
public safety, but funding remains a significant hurdle. He said
that education funding is getting tight. The borough oversees
the schools in all the villages. He said that villages lease
their school buildings. He explained that generating property
taxes to fund education is not an option because residents lease
or rent, making property taxes impractical. The list of
challenges goes on and on. It is an everyday struggle.
MR. MOTO said the borough generates revenue through the Red Dog
Mine via a PILT agreement. The Red Dog Mine ends in 2031. The
borough will renegotiate the PILT agreement after 2026 and is no
longer looking at $25 million revenue. He noted that the Red Dog
Mine contributes roughly 94 percent of the borough's revenue.
MR. MOTO emphasized that fuel costs rise every year. He pointed
out that residents in Noatak pay between $1,000 and $1,200
monthly for electricity due to fuel surcharges. Fuel is flown
in, and costs add up. The borough provides a $2 million water
and sewer subsidy to all eleven villages to reduce the cost of
water and sewer, ensuring clean homes.
2:23:31 PM
SENATOR GRAY-JACKSON inquired about the population of the
Northwest Arctic Borough.
MR. MOTO replied that the population of all eleven villages is
11,000.
2:23:51 PM
SENATOR OLSON brought up the tragic fire in Noorvik a month ago
and another similar incident in Selawik several years ago,
asking what plans the borough has implemented to address fire
suppression.
MR. MOTO replied that a couple of years ago, Selawik experienced
a fire that claimed four lives in one house. Following this
tragedy, the borough lobbied hard for grant money to improve
fire prevention and search and rescue services. The borough
expects to complete the fire, search and rescue, and warm
storage projects in Selawik, Buckland, and Noatak this summer.
However, this still leaves seven villages without adequate
services. The borough hopes to get more funding through a State
grant program to ensure better community safety measures.
2:25:14 PM
SENATOR OLSON said considering the overall public safety
situation and given his experience as a former VPSO, he asked
him to expound on the performance of the VPSO program now that
it is contracted with the borough.
MR. MOTO replied that when he first started his tenure as mayor,
there were zero VPSOs. Now, in his third year, there are roughly
seven trained VPSOs. However, the borough has eleven villages
and is financially unable to provide adequate public safety for
them. As a result, the residents live in fear. He said no one
should have to live that way.
2:26:04 PM
SENATOR OLSON asked about the number of villages that:
- have their own municipal light and power, and
- are a member of the Alaska Village Electric Cooperative
(AVEC).
MR. MOTO replied that Deering is the only village that is self-
run without AVEC. Deering and Buckland manage their own light
plant operations, the Kotzebue Electric Association serves
Kotzebue, and the other communities are members of AVEC.
2:26:39 PM
CHAIR DUNBAR asked whether Kotzebue has a police force.
MR. MOTO said yes, it has a local police department. The city
government runs it. The other ten villages do not have local
village police officers or village public safety officers. The
borough has been working with tribes to establish tribal police
in the villages.
2:27:40 PM
SAM CHANAR, Mayor, City of Toksook Bay, Toksook Bay, Alaska,
discussed the challenges facing rural communities and the
responsibilities and resources of local governments. He stated
that the city's operating budget totals $609,000, with revenue
sources including Payments in Lieu of Taxes (PILT), CAP funding,
and sales tax. Toksook Bay has charitable gaming, and its budget
is about $90,000. He noted that in previous years, before his
tenure as mayor, the administration would allocate some proceeds
from charitable gaming to contribute to the city administration.
MR. CHANAR said Toksook Bay's funding challenges include
heating, insurance, freight costs, and a high local law
enforcement turnover rate. While the municipality does not have
police officers, the tribe recently acquired a VPSO contract.
So, the community now has a village public safety officer.
MR. CHANAR said the community has about 130 households, with
around 90 connected to water and sewer and 30 without it. Last
month, the water and sewer provider sent notices to about 30
households warning of disconnection due to non-payment. Poverty
and unemployment are also issues of concern in the community.
2:30:24 PM
MR. CHANAR discussed the rising insurance costs, which have
increased by about 10 to 15 percent since the national fires and
flooding in the Lower 48. He said the insurance company informed
him to anticipate a 12 percent increase next year.
2:31:19 PM
CHAIR DUNBAR asked about Toksook Bay's population.
MR. CHANAR replied the population is about 650 to 700.
CHAIR DUNBAR inquired about the number of children attending
school.
MR. CHANAR responded that he did not have that information. He
noted that one facility houses K-12 students, estimating the
number to be under 100.
2:32:55 PM
GABRIEL NANOK, City Administrator, City of Chevak, Chevak,
Alaska, discussed the challenges facing rural communities and
the responsibilities and resources of local governments. He
highlighted the need to upgrade the over 20-year-old water and
sewer infrastructure. Additionally, the community is hoping for
a new laundry facility for residents.
MR. NANOK asked whether "Chevak was able to become a hub" and
the city sought an answer to this. He emphasized the necessity
for more trained personnel, suggesting that training would
empower the next generation and reduce the need for external
assistance. Chevak's annual budget is approximately $250,000,
primarily generated from a 3 percent sales tax. He mentioned
that this rate is relatively low and could be increased to
generate more revenue.
2:34:28 PM
SENATOR GRAY-JACKSON asked about Chevak's population.
MR. NANOK replied that according to the census, it is 943. He
expressed his belief that it should be over 1,000.
2:34:39 PM
CHAIR DUNBAR commented that a budget of only $243,000 seems
quite small for a population of around 943. He asked if there
were other sources of funding.
MR. NANOK replied, yes, the city has a the Community Oriented
Policing Services (COPS) grant, PILT, and gaming revenue.
CHAIR DUNBAR inquired about the number of city employees.
MR. NANOK replied that there are six good ones.
2:35:18 PM
CHAIR DUNBAR asked whether Chevak has a police department or
VPSO.
MR. NANOK replied that the city was blessed with a VPSO, which
has been very good for the community. He explained that if the
city were responsible for law enforcement, he would not want to
be in a position where he might have to arrest his own brother.
He expressed gratitude for the VPSO program and out-of-town law
enforcement, stating that having even one VPSO is better than
having none at all.
2:36:01 PM
CHAIR DUNBAR inquired about the partner organization that has
the VPSO.
2:36:05 PM
MR. NANOK replied that Chevak has a traditional council that is
in the process of establishing a tribal court. He expressed hope
that it will receive a COPS grant and more VPSOs, as Chevak
desperately needs trained personnel.
MR. NANOK highlighted that the aging water and sewer
infrastructure is the main concern due to its old age. The
community is seeking a status update on its HUB request, noting
that it has been a while since Chevak made the request.
MR. NANOK mentioned that Hooper Bay, located 17 miles west of
Chevak, has a sub-regional clinic. The challenge is that it is
only accessible by snowmachine, making it difficult to reach. He
said that having easier access to a sub-regional clinic, either
by establishing one in the Chevak area or building a road to
Hooper Bay, would greatly benefit the community. He emphasized
that a road would also provide an escape route in case of
disasters like Typhoon Merbok, which hit Southwest Alaska in
2022.
2:37:56 PM
JOSH VERHAGEN, Mayor, City of Nenana, Nenana, Alaska, discussed
the challenges facing rural communities and the responsibilities
and resources of local governments. He noted that he is the
president of the Alaska Conference of Mayors. He said he would
add the committee as the mayor then as the president of the
Alaska Conference of Mayors. The population of Nenana is 400;
the city has a 12-mill property tax, a 4 percent sales tax, and
an annual operating budget of $1.1 million.
MR. VERHAGEN acknowledged that the State cannot pay for all of
Nenana's needs, so the community has sought additional revenue
sources elsewhere, mainly through grants. Many grant
opportunities exist for water, sewer, and energy projects, which
have been instrumental in improving otherwise cost-prohibitive
projects. One aspect that can be difficult through legislative
grants or State funding is match requirements. He asked for
consideration of the match requirements, explaining that
sometimes the match requirements make it too expensive to accept
a grant. For instance, Nenana had a grant opportunity that would
have given the community some new equipment and required a one-
to-one match. The match requirement was more than Nenana could
afford, which was a significant lost opportunity. He noted that
many small communities struggle with this, noting there are
grant opportunities available, but they cannot afford the match.
2:40:18 PM
MR. VERHAGEN spoke on behalf of the Alaska Conference of Mayors.
He addressed the issue of cost-shifting from the State to
municipalities, particularly for services and unfunded mandates.
He cited the senior tax exemption as an example, noting that
while the State used to fund this, it has not reimbursed
municipalities for lost revenues in a long time. The trend is
that the State still requires municipalities to fund these
obligations, but the legislature does not appropriate funds to
reimburse communities. He said this feels like a double
standard, and the legislature may be out of compliance with
statutes. The Alaska Conference of Mayors requests that the
legislature consider eliminating mandates when the State no
longer appropriates funds to reimburse them.
MR. VERHAGEN stressed that communities can no longer afford to
take on more responsibilities; it places a financial strain on
them. He emphasized that municipalities are required to meet
these obligations even when state appropriations do not align
with the mandates. It creates a financial burden on communities.
He pointed out that many communities, including Nenana, have had
to cut essential services such as police departments and
libraries due to this financial strain. Cost-shifting affects
communities statewide, and he urged consideration of this issue
to ensure municipalities are not overwhelmed by unfunded
mandates.
2:42:11 PM
CHAIR DUNBAR stated that he is familiar with unfunded tax
exemptions as a former chair of the Anchorage Assembly. He said
that on the question of exemptions, there are two bills in
committee. One has not had a hearing yet, but it concerns
nonprofit tax exemptions stemming from a case in Fairbanks
regarding a food bank. He asked whether Nenana is in a borough.
MR. VERHAGEN replied, no.
CHAIR DUNBAR asked whether Nenana has taxed farmland.
MR. VERHAGEN replied that Nenana has no zoning for farmland in
its city limits.
2:43:07 PM
CHAIR DUNBAR said the other bill concerns exempting farmland,
which the Fairbanks North Star Borough voluntarily did. He
sought confirmation that there is a state project to increase
agriculture in the Nenana area.
MR. VERHAGEN responded, right.
CHAIR DUNBAR expressed his belief that there is a State project
to increase agriculture in that area and asked if that was
correct.
MR. VERHAGEN responded, yes.
CHAIR DUNBAR asked about his thoughts on the roughly 140,000-
acre proposed development and its potential effects on Nenana.
2:43:40 PM
MR. VERHAGEN replied that the agricultural development is about
6 miles west of the city limits. It is not within the city's
jurisdiction; however, Nenana has a 27-mile right-of-way through
the agricultural development land. So, the city has had some
involvement in the development of the road and has promoted the
project and power access because it has the potential to benefit
the community by bringing in industry and supporting local
businesses, such as gas stations, restaurants, and hotels.
MR. VERHAGEN mentioned that Nenana expects to see an increase in
the population of the nearby, non-taxable area. These residents
are likely to use city services and attend school without
contributing to the city's revenue. He said there are some pros
and cons, but overall, the city sees it as a benefit for food
security and the indirect industry it may bring.
2:45:28 PM
MARY SWAIN, Presiding Officer, Bristol Bay Borough Assembly,
Bristol Bay, Alaska, discussed the challenges facing rural
communities and the responsibilities and resources of local
governments. She said that, like many of her colleagues, the
borough faces numerous challenges in rural Alaska. She pointed
out that declining fish prices are at the heart of everything
the borough does; fish tax is central to everything. Every
decision revolves around the fishing industry, and it impacts
the borough's core missions: education, health, and safety.
Education
• Bristol Bay was the first state borough founded to fund
education. However, underfunding has resulted in cuts to many
programs.
• Underfunding education has meant a cut in all extracurricular
activities. Outside of basketball, volleyball, and wrestling,
no extracurricular activities exist. The borough lacks art
programs and is trying to establish a shop through the
regional career and technical education (CTE) program. The
program involves four school districts and has been
successful. Unfortunately, individual schools have been unable
to fund other activities.
2:46:48 PM
Health Services
• The borough does not have funding for an emergency medical
service (EMS) or non-Indian Health Service (IHS) community
health center, which poses a risk to elders and residents.
• The community, with a population of 800, swells to between
10,000 and 25,000 during the May, June, and July fishing
season. This influx strains the infrastructure, which is built
to support a community of 800 but must meet the needs of up to
25,000 people for a six-week period.
Underfunded Jails
• Jails in the region are underfunded. Bristol Bay has had to
absorb the responsibilities of other jails in the region.
Bristol Bay does not have the capacity for this. Despite
having no warning or funding to prepare properly, the
community has made do. She said she is proud of Bristol Bay
Borough; however, a lack of preparation and funding has been
challenging.
MS. SWAIN said that the borough needs partners and would like
more school funding, noting that the borough is fortunate to
fund to the cap every year. She said the borough tries to find
other funding options, but it has been difficult. The borough's
budget is between $16 and $18 million, with the majority of
taxes coming from fish tax. The borough also has a property tax
of just over 11 percent.
MS. SWAIN commented that the housing issue in the borough
differs from those in other communities. The borough has
housing. However, with the rapid growth of the fishing industry,
the sector buys every house on the market. These houses are used
for only three months and remain empty for the rest of the year.
2:48:58 PM
CHAIR DUNBAR asked about the villages in the Bristol Bay
Borough.
MS. SWAIN replied that Naknek, King Salmon, and South Naknek are
in the Bristol Bay Borough. It is the only school district in
the country that flies children to school daily.
2:49:34 PM
SENATOR GRAY-JACKSON compared the $1.1 million budget of Nenana,
with a population of 400, to the $16 18 million budget of
Bristol Bay Borough, with a population of 800.
MS. SWAIN said, correct. It is all about the fishing industry.
The community is built on the industry.
2:50:20 PM
KALEB WESTFALL, Council Member, City of Dillingham, Dillingham,
Alaska, discussed the challenges facing rural communities and
the responsibilities and resources of local governments.
Dillingham is about 350 miles west of Anchorage and has a
population of about 2,200. He said that like the Bristol Bay
Borough, the population swells in the summer to about 10,000 to
12,000.
MR. WESTFALL said Dillingham has 392 students in the school
system, including 13 intensive students. Most of the income
comes from a six percent sales tax. The property tax mill rate
is 13 percent. About $4.9 million is received through various
taxes, including gaming, alcohol, transient lodging, remote
sales tax, sales tax, tobacco, and marijuana excise. The total
budget is approximately $25 million, but the aim is to reduce it
to around $16 to $18 million.
MR. WESTFALL stated some of the struggles in Dillingham are
similar to those faced by many other communities. There is a
high cost of living and housing constraints, largely due to land
access issues. Much of this is attributed to Section 14(c) of
the Alaska Native Claims Settlement Act (ANCSA) properties and
the federal park, which restricts expansion.
MR. WESTFALL said that water and wastewater management is a
significant issue. Like many communities with state-owned
airports, there are contamination issues from the per- and
polyfluoroalkyl substances (PFAS) in the firefighting aqueous
film-forming foam (AFFF). This is the number one capital
improvement priority. The city has a plan in the design phase
and seeks a partnership with the state to address this issue.
2:52:49 PM
SENATOR GRAY-JACKSON asked why he wants to see the budget drop
from $25 million to $16 18 million, wondering if that is
because of a budget deficit.
MR. WESTFALL replied that the budget increased due to past COVID
funding and other funds coming through the city. Some items are
budgeted but will not be allocated. The city council is looking
for a right-sized budget for Dillingham to ensure there is no
spending in deficits and to practice realistic government.
SENATOR GRAY-JACKSON said that with COVID funding ending, the
budget will be lower.
2:53:44 PM
CHAIR DUNBAR said the drop from $25 to $16 - 18 million is
significant. He asked what Dillingham plans to cut in the
budget.
MR. WESTFALL replied that an investigation just started to
figure out where the fat was and where the city could get more
efficient. Dillingham has a large tribal entity, with about 50
percent of the population being Alaska Native Yupik and the
other 50 percent non-Native. There is a good partnership between
the tribal entity and the city, and efforts are underway to
leverage each other's abilities to earn and receive grant
funding. The goal is to work together to grow, become more
independent, and be able to shrink the budgets while also
generating more revenue and services through a growing
infrastructure. The aim is to achieve sustainable growth and
revenue rather than relying on one-time funding.
2:55:37 PM
KATHY LEARY, City Administrator, Gustavus, Alaska, discussed the
challenges facing rural communities and the responsibilities and
resources of local governments. She said that according to the
census, Gustavus has a population of about 655, although this
number likely reflects the summer population when tourism is at
its peak. The population doubles in the summer due to the
tourism industry, with many residents working for the National
Park Service (NPS) at Glacier Bay National Park in Bartlett
Cove. The number of park service employees also increases during
the summer.
MS. LEARY stated that the city has a K-12 school with 61
students this year. The school population fluctuates with the
arrival of new families each year. Additionally, there is a
homeschool population in the community. The city employs two
full-time salaried employees, six part-time employees, and a
couple of seasonal employees, such as the marine facilities
coordinator.
2:57:02 PM
MS. LEARY highlighted that Gustavus has a large airport run by
the Department of Transportation and Public Facilities (DOTPF).
Alaska Airlines, through Essential Air Service, operates flights
in the summer. However, this service is at risk because the city
lacks law enforcement. NPS rangers provided emergency services
until the Department of Interior made a determination to no
longer offer these services. The city, DOTPF, and the Department
of Public Safety (DPS) are working to resolve this issue to
ensure the airline continues to operate as it significantly
contributes to tourism revenue.
MS. LEARY said the city generates revenue through a three
percent tax, a four percent bed tax, a fish box tax, PILT money,
CAP funds, and national forest receipts. She said that the city
uses a lot of these funds to maintain almost 30 miles of dirt
and gravel roads, with maintenance contracted out. The city
faces significant PFAS issues, particularly related to testing
at the airport. She said that she is uncertain why funding for
ongoing testing was not budgeted this year, which is a concern.
Continual PFAS readings are necessary to monitor the situation.
2:58:57 PM
MS. LEARY said that the water system in Gustavus consists of
wells and septic systems. She announced that the city applied
for and was awarded an areawide planning grant safe water and
septage planning. In the interim, the city purchased two 10,000-
gallon tanks, which are installed below ground. Juneau Septic
Services ferries a septic pump truck to Gustavus for about a
week and pumps out home septic systems, storing the waste in the
tanks. A bigger tanker returns to Gustavus; it is first off and
last on the ferry. The bigger tanker pumps the storage tanks and
returns to Juneau for proper disposal of the waste. She said
this is how Gustavus manages its sewage. This method, though
unconventional, is necessary due to the high water table in the
area.
MS. LEARY expressed concerns about a looming borough petition
from Hoonah, which encompasses a huge swath of water and land.
This petition proposes taxing tourism activities less than half
a mile off the dock. This has brought up concerns about the
city's PILT money and the potential compromise of city revenues
due to this petition. She said it is an alarming amount of land
and water, and adjoining neighboring communities such as
Pelican, Tenakee, and Elfin Cove also oppose this petition.
3:00:57 PM
CHAIR DUNBAR asked whether the petition includes any of those
small communities.
MS. LEARY replied that Gustavus and Pelican were not part of the
petition. The City of Hoonah wants Elfin Cove and Funter Bay.
She said the Local Boundary Commission (LBC) oversees boundary
changes whose standards must be reviewed and met.
3:01:31 PM
CHAIR DUNBAR observed that the meeting just ran out of time and
asked if she would like to make concluding remarks.
3:01:37 PM
MS. LEARY said that Gustavus is trying to prolong the life of
its gravel pit so that residents can access materials without
incurring the high costs associated with dredging operations.
Gustavus handles many local city projects using its revenues.
However, expenditures beyond the city's capability, like some
requirements involving permitting and wetlands, pose significant
challenges. While the city strives to manage its needs, it faces
potential threats from impending borough boundary changes.
3:02:36 PM
SENATOR GRAY-JACKSON asked about the budget.
MS. LEARY said it is about $1.2 million.
3:02:44 PM
CHAIR DUNBAR thanked Mr. Andreassen for organizing the
testifiers from rural communities. He said that although the
communities are varied with diverse needs, there are recurring
similar themes: a lack of revenue sources, law enforcement,
housing, and high energy costs. He said there has been a
tremendous shifting of costs from state to local governments.
3:04:19 PM
There being no further business to come before the committee,
Chair Dunbar adjourned the Senate Community and Regional Affairs
Standing Committee meeting at 3:04 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| SR 3 Sponsor Statement.pdf |
SCRA 2/20/2024 1:30:00 PM |
SR 3 |
| SR 3 ver A.pdf |
SCRA 2/20/2024 1:30:00 PM |
SR 3 |
| AML - Challenges in Rural Communities.pptx |
SCRA 2/20/2024 1:30:00 PM |
|
| SR3 Fresenius Medical Care Letter of Support_.pdf |
SCRA 2/20/2024 1:30:00 PM |
SR 3 |
| AKPA Letter of Support for Senate Resolution No 3.pdf |
SCRA 2/20/2024 1:30:00 PM |
SR 3 |