00 SENATE BILL NO. 248 01 "An Act relating to administrative boroughs; relating to municipal school districts; 02 relating to standards for incorporation of boroughs and unified municipalities; 03 eliminating obsolete provisions relating to a third class borough and making technical 04 changes to statutes relating to regional educational attendance areas; and relating to 05 new borough grants for certain newly incorporated boroughs and unified 06 municipalities." 07 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 08  * Section 1. AS 14.08.011(a) is amended to read: 09 (a) It is the purpose of this chapter to provide for public education in the 10 administrative boroughs, unorganized borough, and the military reservations in the 11 state. 12  * Sec. 2. AS 14.08.031(a) is amended to read: 13 (a) The Department of Commerce, Community, and Economic Development 01 in consultation with the Department of Education and Early Development and local 02 communities shall divide the administrative boroughs and the unorganized borough 03 into educational service areas using the boundaries or sub-boundaries of the regional 04 corporations established under the Alaska Native Claims Settlement Act, unless by 05 referendum a community votes to merge with another community contiguous to it but 06 within the boundaries or sub-boundaries of another regional corporation. 07  * Sec. 3. AS 14.08.031(b) is amended to read: 08 (b) An educational service area established in the administrative boroughs  09 and the unorganized borough under (a) of this section constitutes a regional 10 educational attendance area. As far as practicable, each regional educational 11 attendance area shall contain an integrated socio-economic, linguistically and 12 culturally homogeneous area. In the formation of the regional educational attendance 13 areas, consideration shall be given to the transportation and communication network to 14 facilitate the administration of education and communication between communities 15 that comprise the area. Whenever possible, municipalities, other governmental or 16 regional corporate entities, drainage basins, and other identifiable geographic features 17 shall be used in describing the boundaries of the regional school attendance areas. 18  * Sec. 4. AS 14.08.071(a) is amended to read: 19 (a) In each regional educational attendance area [IN THE UNORGANIZED 20 BOROUGH], the lieutenant governor, within not less than 60, nor more than 90 days 21 after the establishment of the regional educational attendance area, shall provide for 22 the election of a regional school board. 23  * Sec. 5. AS 14.08.071(b) is amended to read: 24 (b) Except for the first election of regional school board members under (a) of 25 this section, elections shall be held annually on the first Tuesday in October. Elections 26 shall be supervised by the director of elections in the office of the lieutenant governor, 27 but shall be administered within administrative boroughs and second class cities as 28 part of the regular municipal election. The lieutenant governor shall adopt regulations 29 for the conduct of the election of regional school board members comparable, as far as 30 practicable, to those prescribed for election of school board members under AS 14.12 31 and AS 29.20.300 except that the majority election requirements of AS 29.26.060 do 01 not apply to, nor may the regulations require runoff elections for, the first election of 02 regional school board members under (a) of this section or, if a school board by 03 resolution so requests, to subsequent elections in the regional educational attendance 04 area served by that school board. 05  * Sec. 6. AS 14.12.010 is amended to read: 06 Sec. 14.12.010. Districts of state public school system. Except as provided  07 in AS 14.12.025 and subject to AS 14.14.120, the [THE] districts of the state public 08 school system are as follows: 09 (1) each home rule and first class city in an administrative borough  10 or in the unorganized borough is a city school district; 11 (2) except for an administrative borough, each organized borough is 12 a borough school district; 13 (3) each [THE AREA OUTSIDE ORGANIZED BOROUGHS AND 14 OUTSIDE HOME RULE AND FIRST CLASS CITIES IS DIVIDED INTO] regional 15 educational attendance area established under AS 14.08.031 is a school district that  16 has jurisdiction outside city school districts within its boundaries [AREAS]. 17  * Sec. 7. AS 14.12.110 is amended to read: 18 Sec. 14.12.110. Single body as assembly and school board. Notwithstanding 19 the provisions of this chapter or other law, a single body may serve as both the 20 assembly and school board [IN THE MANNER PROVIDED FOR THIRD CLASS 21 BOROUGHS UNDER AS 29.20.300(b),] if 22 (1) an ordinance for that purpose is approved by the assembly and 23 ratified by a referendum of a majority of the qualified borough voters voting on the 24 question at a regular or special election; and 25 (2) the public school population within the borough is 500 pupils or 26 less. 27  * Sec. 8. AS 14.60.010(7) is amended to read: 28 (7) "regional educational attendance area" means an educational 29 service area in an administrative borough or the unorganized borough that 30 [WHICH] may or may not include a military reservation, and that contains one or 31 more public schools of grade levels K-12 or any portion of those grade levels that are 01 to be operated under the management and control of a single regional school board; 02  * Sec. 9. AS 23.40.250(8) is amended to read: 03 (8) "regional educational attendance area" means an educational 04 service area in an administrative borough or the unorganized borough that may or 05 may not include a military reservation, and that contains one or more public schools of 06 grade levels K - 12 or any portion of those grade levels that are to be operated under 07 the management and control of a single regional school board; 08  * Sec. 10. AS 29.04.030 is amended to read: 09 Sec. 29.04.030. Classes of general law. General law municipalities are of five 10 classes: 11 (1) first class boroughs; 12 (2) second class boroughs; 13 (3) administrative [THIRD CLASS] boroughs; 14 (4) first class cities; 15 (5) second class cities. 16  * Sec. 11. AS 29.04.060(a) is amended to read: 17 (a) An administrative [A THIRD CLASS] borough may reclassify as a first 18 or second class borough in the manner provided by AS 29.04.040 [AS 29.35.320 - 19 29.35.330] for the reclassification of cities [ADDITION OF AN AREAWIDE 20 POWER BY A FIRST OR SECOND CLASS BOROUGH], except the petition or 21 proposal requests reclassification of an administrative borough instead of requesting 22 reclassification of a city. [ADDITION OF A POWER. AT THE TIME OF VOTING 23 ON RECLASSIFICATION OF A THIRD CLASS BOROUGH TO FIRST OR 24 SECOND CLASS STATUS, VOTERS SHALL VOTE ALSO ON WHETHER THE 25 BOROUGH SHALL, ON RECLASSIFICATION, RETAIN A COMBINED 26 ASSEMBLY AND SCHOOL BOARD OR ELECT A SEPARATE ASSEMBLY 27 AND BOARD AS OTHERWISE PROVIDED FOR FIRST AND SECOND CLASS 28 BOROUGHS.] 29  * Sec. 12. AS 29.04.060(c) is amended to read: 30 (c) If [A SEPARATE ASSEMBLY AND SCHOOL BOARD ARE 31 APPROVED AT] the reclassification is approved [ELECTION], a school board shall 01 be elected in conformity with AS 14.12.030 - 14.12.100 at the next regular election, if 02 it occurs within 90 days after [OF] the date of the reclassification election, or 03 [OTHERWISE] at a special election within 90 days after [OF] the date of the 04 reclassification election. Expiration dates of terms of school board members elected at 05 a special election must coincide with the date of the regular election. [UNTIL A 06 BOARD IS ELECTED AND QUALIFIED, THE ASSEMBLY CONTINUES TO 07 SERVE AS THE BOARD.] 08  * Sec. 13. AS 29.05.031(a) is amended to read: 09 (a) An area that meets the following standards may incorporate as a home rule, 10 first class, [OR] second class, or administrative borough, or as a unified 11 municipality: 12 (1) the population of the area is interrelated and integrated as to its 13 social, cultural, and economic activities, and is large and stable enough to support 14 borough government; 15 (2) the boundaries of the proposed borough or unified municipality 16 encompass a natural region that promotes service delivery on an efficient and  17 cost-effective basis, conform generally to natural geography, and include all areas 18 necessary for full development of municipal services; 19 (3) the economy of the area includes the human and financial resources 20 capable of providing municipal services; evaluation of an area's economy includes 21 land use, property values, total economic base, total personal income, resource and 22 commercial development, anticipated functions, expenses, and income of the proposed 23 borough or unified municipality; 24 (4) land, water, and air transportation facilities allow the 25 communication and exchange necessary for the development of integrated borough 26 government. 27  * Sec. 14. AS 29.05.031 is amended by adding a new subsection to read: 28 (c) In setting boundaries of a proposed borough or unified municipality, 29 consideration shall be given to existing administrative or corporate boundaries and to 30 drainage basins or other regional geographic features. 31  * Sec. 15. AS 29.05.060 is amended to read: 01 Sec. 29.05.060. Petition. Municipal incorporation is proposed by filing a 02 petition with the department. The petition must include the following information 03 about the proposed municipality: 04 (1) class; 05 (2) name; 06 (3) boundaries; 07 (4) maps, documents, and other information required by the 08 department; 09 (5) composition and apportionment of the governing body; 10 (6) a proposed operating budget for the municipality projecting sources 11 of income and items of expenditure through the first full fiscal year of operation; 12 (7) for a borough or unified municipality, based on the number who 13 voted in the respective areas in the last general election, the signature and resident 14 address of 15 percent of the voters in 15 (A) home rule and first class cities in the area of the proposed 16 borough or unified municipality; and 17 (B) the area of the proposed borough or unified municipality 18 outside home rule and first class cities; 19 (8) for a first class borough or unified municipality, a designation of 20 areawide powers to be exercised; 21 (9) for a second class or administrative borough, a designation of 22 areawide and nonareawide powers to be exercised; 23 (10) for a first class, second class, or home rule city, a designation of 24 the powers to be exercised; 25 (11) for a first class or home rule city, based on the number who voted 26 in the area in the last general election, the signatures and resident addresses of 50 27 voters in the proposed city or of 15 percent of the voters in the proposed city, 28 whichever is greater; 29 (12) for a second class city, based on the number who voted in the area 30 in the last general election, the signatures and resident addresses of 25 voters in the 31 proposed city or of 15 percent of the voters in the proposed city, whichever is greater; 01 (13) for a home rule city, home rule borough, or unified municipality a 02 proposed home rule charter. 03  * Sec. 16. AS 29.05.110(c) is amended to read: 04 (c) Areawide borough powers included in an incorporation petition are 05 considered to be part of the incorporation question. In an election for the incorporation 06 of a second class borough or an administrative borough, each nonareawide power to 07 be exercised is placed separately on the ballot. Adoption of a nonareawide power 08 requires a majority of the votes cast on the question, and the vote is limited to the 09 qualified voters who are registered to vote in the proposed borough but outside all 10 cities in the proposed borough. 11  * Sec. 17. AS 29.05.130 is amended by adding a new subsection to read: 12 (c) This section does not apply to a regional educational attendance area in a 13 newly incorporated administrative borough. 14  * Sec. 18. AS 29.05.140(f) is amended to read: 15 (f) This section does not apply to a regional educational attendance area  16 in an administrative borough. Otherwise, this section applies to home rule and 17 general law municipalities. 18  * Sec. 19. AS 29.05.190(a) is amended to read: 19 (a) For the purpose of defraying the cost of transition to borough government 20 and to provide for interim governmental operations, each borough or unified 21 municipality incorporated after December 31, 1985, is entitled to organization grants 22 as follows: 23 (1) [$300,000] for the municipality's first full or partial fiscal year -  24 $250,000 for an administrative borough or $300,000 for a borough of another  25 class or for a unified municipality; 26 (2) [$200,000] for the municipality's second fiscal year - $250,000 for  27 an administrative borough or $200,000 for a borough of another class or for a  28 unified municipality; and 29 (3) [$100,000] for the municipality's third fiscal year - $250,000 for an  30 administrative borough or $100,000 for a borough of another class or for a  31 unified municipality. 01  * Sec. 20. AS 29.05.190(c) is amended to read: 02 (c) This [EXCEPT AS PROVIDED IN (d) OF THIS SECTION, THIS] 03 section does not apply to a borough incorporated by consolidation or to a unified 04 municipality that occupies the area formerly occupied by a borough. 05  * Sec. 21. AS 29.05 is amended by adding a new section to read: 06 Sec. 29.05.205. New borough grants. (a) For the purpose of providing for 07 financial stability, each borough or unified municipality incorporated during the period 08 that begins on the effective date of this Act and ends four years after the effective date 09 of this Act is entitled to a new borough grant in addition to organization grants under 10 AS 29.05.190. The amount of the new borough grant for a borough or unified 11 municipality that is entitled to at least 15,000 acres of general grant land under 12 AS 29.65.030 is $12,500,000. Otherwise, the amount of the new borough grant is 13 $15,000,000. 14 (b) New borough grant money may only be used for investments by the 15 municipality that receives it. The municipality may use realized income from the 16 investments for any of its municipal purposes. 17 (c) This section does not apply to a borough incorporated by consolidation or 18 to a unified municipality that occupies the area formerly occupied by a borough. 19 (d) The department may adopt regulations to implement this section. The 20 department shall disburse new borough grant money within 30 days after it is 21 appropriated and available for the purpose. Before August 31 of each fiscal year, the 22 department shall submit a report to the office of management and budget identifying 23 (1) each borough or unified municipality expected to qualify to receive 24 a new borough grant during the next fiscal year; 25 (2) the amount of money needed to fund expected new borough grants; 26 and 27 (3) the amount of money needed to fund any remaining unpaid new 28 borough grant amounts from prior fiscal year entitlements. 29  * Sec. 22. AS 29.06.090(a) is amended to read: 30 (a) Two or more municipalities may merge or consolidate to form a single 31 general law or home rule municipality, except an administrative [A THIRD CLASS] 01 borough may not be formed through merger or consolidation. 02  * Sec. 23. AS 29.06.190(a) is amended to read: 03 (a) A borough and all cities in the borough may unite to form a single unit of 04 home rule government by complying with AS 29.06.190 - 29.06.410. However, an  05 administrative borough may unite with cities only on approval of the local  06 boundary commission under the procedure provided by AS 29.04.040(a) and (b)  07 for the reclassification of cities, except the petition or proposal requests  08 unification rather than requesting reclassification. 09  * Sec. 24. AS 29.06.470(a) is amended to read: 10 (a) Except as provided in (b) of this section, voters of a municipality may 11 petition for dissolution when the municipality is free of debt, or, if in debt, each of its 12 creditors is satisfied with a method of repayment and 13 (1) the municipality no longer meets the minimum standards 14 prescribed for incorporation by AS 29.05 [, OR FORMER AS 29.18.030 IF IT IS A 15 THIRD CLASS BOROUGH]; 16 (2) the municipality ceases to use each of its mandatory powers; or 17 (3) the dissolution petition filed under AS 29.06.460 is signed by a 18 number of voters of the municipality proposed to be dissolved greater than 50 percent 19 of the number of votes cast in the last regular election in that municipality. 20  * Sec. 25. AS 29.10.010(a) is amended to read: 21 (a) A general law borough or first class city may adopt a charter for its own 22 government. However, an administrative borough may adopt a charter only on  23 approval of the local boundary commission under the procedure provided by  24 AS 29.04.040(a) and (b) for the reclassification of cities, except the petition or  25 proposal requests unification rather than requesting reclassification. 26  * Sec. 26. AS 29.10.080(b) is amended to read: 27 (b) [AT THE TIME OF VOTING ON THE PROPOSED CHARTER IN A 28 THIRD CLASS BOROUGH, VOTERS SHALL VOTE ALSO ON WHETHER THE 29 BOROUGH SHALL, ON ADOPTION OF THE CHARTER, RETAIN A 30 COMBINED ASSEMBLY AND SCHOOL BOARD OR ELECT A SEPARATE 31 ASSEMBLY AND BOARD AS OTHERWISE PROVIDED FOR HOME RULE 01 BOROUGHS. IF A COMBINED ASSEMBLY AND SCHOOL BOARD ARE 02 APPROVED AT THE CHARTER ELECTION, THE ASSEMBLY SERVING AT 03 THE TIME OF THE ELECTION CONTINUES TO SERVE AS THE ASSEMBLY 04 AND BOARD ON VOTER APPROVAL OF THE CHARTER AND UNTIL TERMS 05 OF ASSEMBLY MEMBERS EXPIRE AS PROVIDED BEFORE ADOPTION OF 06 THE CHARTER.] If a charter is [SEPARATE BOARD AND ASSEMBLY ARE] 07 approved at the charter election in an administrative borough, a school board shall 08 be elected in conformity with AS 14.12.030 - 14.12.100 at the next regular election, if 09 it occurs within 90 days after [OF] the date of the charter election, or [OTHERWISE] 10 at a special election within 90 days after [OF] the date of the charter election. 11 Expiration dates of terms of school board members elected at a special election shall 12 coincide with the date of the regular election. [UNTIL A BOARD IS ELECTED AND 13 QUALIFIED, THE ASSEMBLY CONTINUES TO SERVE AS THE BOARD.] 14  * Sec. 27. AS 29.20.300(a) is amended to read: 15 (a) Each municipal school district has a school board. Members [EXCEPT 16 AS PROVIDED IN (b) OF THIS SECTION, MEMBERS] of a school board are 17 elected at the regular election for three-year terms and until their successors take 18 office. Members are elected at large unless a different method of election has been 19 approved by the voters in a regular election. 20  * Sec. 28. AS 29.25.010(a) is amended to read: 21 (a) In addition to other actions that this title requires to be by ordinance, the 22 governing body of a municipality shall use ordinances to 23 (1) establish, alter, or abolish municipal departments; 24 (2) provide for a fine or other penalty, or establish rules or regulations 25 for violation of which a fine or other penalty is imposed; 26 (3) provide for the levying of taxes; 27 (4) make appropriations, including supplemental appropriations or 28 transfer of appropriations. 29 (5) grant, renew, or extend a franchise; 30 (6) adopt, modify, or repeal the comprehensive plan, land use and 31 subdivision regulations, building and housing codes, and the official map; 01 (7) approve the transfer of a power from a city to an administrative  02 borough or a first or second class borough [FROM A CITY]; 03 (8) designate the borough seat; 04 (9) provide for the retention or sale of tax-foreclosed property; 05 (10) exempt contractors from compliance with general requirements 06 relating to payment and performance bonds in the construction or repair of municipal 07 public works projects within the limitations set out in AS 36.25.025; this paragraph 08 applies to home rule and general law municipalities. 09  * Sec. 29. AS 29.35.150 is amended to read: 10 Sec. 29.35.150. Scope of areawide powers. Except as otherwise provided, a  11 [A] borough shall exercise the powers as specified and in the manner specified in 12 AS 29.35.150 - 29.35.180 on an areawide basis. 13  * Sec. 30. AS 29.35.160(a) is amended to read: 14 (a) An administrative borough is not a school district and may not  15 exercise education powers. Each home rule, first class, and second class borough 16 and unified municipality constitutes a borough school district and establishes, 17 maintains, and operates a system of public schools on an areawide basis as provided in 18 AS 14.14.060. A military reservation in a borough is not part of the borough school 19 district until the military mission is terminated or until inclusion in the borough school 20 district is approved by the Department of Education and Early Development. 21 However, operation of the military reservation schools by the borough school district 22 may be required by the Department of Education and Early Development under 23 AS 14.14.110. If the military mission of a military reservation terminates or continued 24 management and control by a regional educational attendance area is disapproved by 25 the Department of Education and Early Development, operation, management, and 26 control of schools on the military reservation transfers to the borough school district in 27 which the military reservation is located. 28  * Sec. 31. AS 29.35.170 is amended to read: 29 Sec. 29.35.170. Assessment and collection of taxes. (a) A first class or  30 second class borough shall assess and collect property, sales, and use taxes that are 31 levied in its boundaries, subject to AS 29.45. An administrative borough may assess  01 and collect sales and use taxes that are levied in its boundaries, subject to  02 AS 29.45, but may not levy other types of taxes.  03 (b) Taxes levied by a city in a home rule, first class, or second class  04 borough shall be collected by the [A] borough and returned in full to the levying city. 05 Sales and use taxes levied by a city in an administrative borough THAT LEVIES  06 A SALES AND USE TAX shall be collected by the borough and returned in full  07 to the levying city. This subsection applies to home rule and general law 08 municipalities. 09  * Sec. 32. AS 29.35.180(a) is amended to read: 10 (a) A first or second class borough shall provide for planning, platting, and 11 land use regulation in accordance with AS 29.40. An administrative borough shall  12 provide for planning, platting, and land use regulation in accordance with  13 AS 29.40 outside of cities within its boundaries that, on the day before the date of  14 incorporation of the administrative borough, were providing for planning,  15 platting, and land use regulation under AS 29.35.260(c).  16  * Sec. 33. AS 29.35.220(a) is amended to read: 17 (a) An administrative [A THIRD CLASS] borough may borrow money and 18 issue negotiable or nonnegotiable bonds or other evidences of indebtedness as 19 provided by AS 29.47. 20  * Sec. 34. AS 29.35.220(b) is amended to read: 21 (b) Areawide exercise of a power not otherwise prohibited by law by an  22 administrative borough [A THIRD CLASS BOROUGH OTHER THAN 23 EDUCATION AND TAX ASSESSMENT AND COLLECTION] is [NOT] 24 authorized if the power was acquired upon incorporation under AS 29.05.110(c)  25 or is acquired in accordance with AS 29.35.300. 26  * Sec. 35. AS 29.35.220(d) is amended to read: 27 (d) An administrative [A THIRD CLASS] borough may acquire any 28 nonareawide power not otherwise prohibited by law if [, EXCEPT] the power was  29 acquired upon incorporation under AS 29.05.110(c) or is acquired under  30 AS 29.35.300 [MAY ONLY BE EXERCISED WITHIN A SERVICE AREA]. 31  * Sec. 36. AS 29.35.220(e) is amended to read: 01 (e) An administrative [A THIRD CLASS] borough may by ordinance 02 exercise the power necessary to contain, clean up, or prevent a release or threatened 03 release of oil or a hazardous substance, and exercise a power granted to a municipality 04 under AS 46.04, AS 46.08, or AS 46.09, but the power authorized by this subsection 05 may be exercised only on a nonareawide basis. The borough shall exercise its 06 authority under this subsection in a manner that is consistent with a regional master 07 plan prepared by the Department of Environmental Conservation under AS 46.04.210. 08  * Sec. 37. AS 29.35.220 is amended by adding a new subsection to read: 09 (f) An administrative borough may by ordinance provide for economic 10 development outside of cities within its boundaries that, on the day before the 11 effective date of the incorporation of the administrative borough, were providing for 12 economic development. A city may transfer its power to provide for economic 13 development or the borough may acquire the power to provide for economic 14 development on an areawide basis under AS 29.35.300. 15  * Sec. 38. AS 29.35.250(c) is amended to read: 16 (c) Unless the city was not exercising the power on the day before the date  17 the borough was incorporated or the borough acquires the power under  18 AS 29.35.300,  19 (1) a [A] home rule city in an administrative [A THIRD CLASS] 20 borough shall provide for planning, platting, and land use regulation as provided by 21 AS 29.35.180(b) for home rule boroughs; 22 (2) a [. A] first class city in an administrative [A THIRD CLASS] 23 borough shall provide for planning, platting, and land use regulation as provided by 24 AS 29.35.180(a) for first and second class boroughs; and  25 (3) a [. A] second class city in an administrative [A THIRD CLASS] 26 borough may provide for planning, platting, and land use regulation as provided by 27 AS 29.35.180(a) for first and second class boroughs. 28  * Sec. 39. AS 29.35.250 is amended by adding a new subsection to read: 29 (e) Except as provided in AS 14.12.025 and subject to AS 14.14.120, a home 30 rule or first class city in an administrative borough is a city school district and shall 31 establish, operate, and maintain a system of public schools as provided by 01 AS 29.35.160 for unified municipalities and home rule, first class, and second class 02 boroughs. A second class city in an administrative borough is not a school district and 03 may not establish a system of public schools. 04  * Sec. 40. AS 29.35.260(b) is amended to read: 05 (b) Except as provided in AS 14.12.025 and subject to AS 14.14.120, a [A] 06 home rule or first class city outside a borough is a city school district and shall 07 establish, operate, and maintain a system of public schools as provided by 08 AS 29.35.160 for boroughs. A second class city outside a borough is not a school 09 district and may not establish a system of public schools. 10  * Sec. 41. AS 29.35.300(b) is amended to read: 11 (b) A second class or administrative borough acquires an additional power 12 by transfer of the power by a city or by holding an election on the question. For 13 acquisition of an areawide power, the election shall be held areawide. For acquisition 14 of a nonareawide power, the election shall be held nonareawide. An administrative  15 borough may not acquire the power to provide for education.  16  * Sec. 42. AS 29.35.310 is amended to read: 17 Sec. 29.35.310. Transfer by city. (a) A city in a first or second class borough 18 may transfer to the borough in which it is located any of its powers or functions, 19 subject to the approval of the assembly. A city in an administrative borough may  20 transfer to the borough in which it is located any of its powers or functions, other  21 than education, subject to the approval of the assembly.  22 (b) A [FIRST OR SECOND CLASS] borough shall exercise all powers 23 transferred to it by a city. 24  * Sec. 43. AS 29.35.320(a) is amended to read: 25 (a) An election on the question of adding an areawide power in a first class 26 borough or of adding an areawide or nonareawide power in a second class borough or  27 an administrative borough may be initiated in two ways: 28 (1) a number of voters equal to 15 percent of the number of votes cast 29 at the preceding regular election in the area, either areawide or nonareawide, in which 30 the election is to be held may file a petition with the borough clerk; or 31 (2) the assembly may propose the acquisition of the power. 01  * Sec. 44. AS 29.35.320(c) is amended to read: 02 (c) The borough clerk shall certify whether a petition filed under (a) [OR (b)] 03 of this section contains the required number of signatures. 04  * Sec. 45. AS 29.35.330(c) is amended to read: 05 (c) A vote on the question of adding an areawide power in a first or second 06 class borough or in an administrative borough shall be tabulated in two separate 07 classifications. One shall consist of all votes cast in all cities located in the borough. 08 The other shall consist of all votes cast in the borough area outside all cities. If the 09 majority of the votes cast in each classification is favorable, the borough shall assume 10 the added power within 30 days after certification of the election results. 11  * Sec. 46. AS 29.35.330(d) is amended to read: 12 (d) If a majority of the votes cast on the question of adding a nonareawide 13 power in a second class borough or an administrative borough [A POWER TO BE 14 EXERCISED IN A SERVICE AREA IN A THIRD CLASS BOROUGH] is 15 favorable, the borough shall assume the added power within 30 days after certification 16 of the election results. 17  * Sec. 47. AS 29.35.340(a) is amended to read: 18 (a) On acquisition of an areawide power, the first or second class borough or  19 administrative borough succeeds to all of the rights, powers, and duties of any city 20 or service area with respect to that power. The borough succeeds to claims, franchises, 21 and other contractual obligations, liability for bonded and all other indebtedness, and 22 to all of the right, title, and interest in the real and personal property held by a city or 23 service area for the exercise of the power. 24  * Sec. 48. AS 29.35.340(c) is amended to read: 25 (c) On acquisition of an additional areawide power, the first or second class 26 borough or administrative borough, in consultation with the city or service area 27 personnel, shall arrange for an orderly and equitable transfer of rights, assets, 28 liabilities, powers, duties, and other matters related to acquisition of the areawide 29 powers. 30  * Sec. 49. AS 29.35.470(b) is amended to read: 31 (b) Except in an administrative borough, the [THE] assembly may by 01 ordinance establish, alter, and abolish differential tax zones within a service area to 02 provide and levy property taxes for a different level of services than that provided 03 generally in the service area. Taxes levied within a differential tax zone that exceed 04 the amount that would have otherwise been levied may only be used for the services 05 provided in that zone. 06  * Sec. 50. AS 29.35.490(a) is amended to read: 07 (a) A second class borough or an administrative borough may exercise in a 08 service area any power granted a first class city by law or a nonareawide power that 09 may be exercised by a first class borough if 10 (1) the exercise of the power is approved by a majority of the voters 11 residing in the service area; or 12 (2) all owners of real property in the service area consent in writing to 13 the exercise of the power if no voters reside in the service area. 14  * Sec. 51. AS 29.35.490(c) is amended to read: 15 (c) A second [OR THIRD] class borough or an administrative borough may 16 establish a service area that includes only vacant, unappropriated, and unreserved land 17 owned by the borough. A second [OR THIRD] class borough or an administrative  18 borough may establish a service area, with the concurrence of the commissioner of 19 natural resources, that includes only vacant, unappropriated, and unreserved land 20 owned by the state and classified for disposal to individuals. By ordinance a second 21 [OR THIRD] class borough or an administrative borough may provide the services 22 in a service area established under this subsection necessary to develop state or 23 municipal land as required by the planning, platting, and land use regulations of the 24 borough. 25  * Sec. 52. AS 29.40.010(a) is amended to read: 26 (a) A first or second class borough shall provide for planning, platting, and 27 land use regulation on an areawide basis. An administrative borough shall provide  28 for planning, platting, and land use regulation outside of cities within its  29 boundaries that, on the day before the date of incorporation of the administrative  30 borough, were providing for planning, platting, and land use regulation under  31 AS 29.35.260(c).  01  * Sec. 53. AS 29.40.020(a) is amended to read: 02 (a) Each [FIRST AND SECOND CLASS] borough shall establish a planning 03 commission consisting of five residents unless a greater number is required by 04 ordinance. In each first and second class borough, [COMMISSION] membership 05 shall be apportioned so that the number of members from home rule and first class 06 cities reflects the proportion of borough population residing in home rule and first 07 class cities located in the borough. In each administrative borough, commission  08 membership shall be apportioned so that the number of members from cities that  09 do not exercise the power of land use regulation reflects the proportion of  10 borough population residing in those cities. A member shall be appointed by the 11 borough mayor for a term of three years subject to confirmation by the assembly, 12 except that a member from a [HOME RULE OR FIRST CLASS] city shall be selected 13 from a list of recommendations submitted by the council. Members first appointed 14 shall draw lots for one, two, and three year terms. Appointments to fill vacancies are 15 for the unexpired term. The compensation and expenses of the planning commission 16 and its staff are paid as directed by the assembly. 17  * Sec. 54. AS 29.40.030(a) is amended to read: 18 (a) The comprehensive plan is a compilation of policy statements, goals, 19 standards, and maps for guiding the physical, social, and economic development, both 20 private and public, of the [FIRST OR SECOND CLASS] borough, and may include, 21 but is not limited to, the following: 22 (1) statements of policies, goals, and standards; 23 (2) a land use plan; 24 (3) a community facilities plan; 25 (4) a transportation plan; and 26 (5) recommendations for implementation of the comprehensive plan. 27  * Sec. 55. AS 29.45.010(a) is amended to read: 28 (a) A unified municipality may levy a property tax. A home rule, first class,  29 or second class borough may levy 30 (1) an areawide property tax for areawide functions; 31 (2) a nonareawide property tax for functions limited to the area outside 01 cities; 02 (3) a property tax in a service area for functions limited to the service 03 area. 04  * Sec. 56. AS 30.13.150 is amended to read: 05 Sec. 30.13.150. Succession. Whenever a borough [OF THE FIRST OR 06 SECOND CLASS] or a home rule municipality is created with an area coterminous 07 with or inclusive of the area of an authority, the authority shall be integrated into the 08 borough or home rule municipality within one year after [OF] incorporation. On 09 integration, the borough or home rule municipality succeeds to all the rights, powers, 10 duties, assets, and liabilities of the authority, except that any indebtedness of an 11 authority does not constitute a general obligation of the borough or home rule 12 municipality payable from taxes levied by the borough or home rule municipality. The 13 borough or home rule municipality may not levy any taxes to pay the indebtedness. 14  * Sec. 57. AS 38.05.037(a) is amended to read: 15 (a) In areas of the state outside [FIRST, SECOND, OR THIRD CLASS] 16 boroughs where there is not a city [NO MUNICIPALITY] with [A] zoning power, the 17 division of lands shall exercise the zoning power by adopting zoning regulations. 18  * Sec. 58. AS 41.15.180(a) is amended to read: 19 (a) When the commissioner of commerce, community, and economic 20 development receives national forest income under 16 U.S.C. 500, the commissioner 21 shall immediately pay to each organized borough in which national forest land is 22 located a share of the income from that forest; an organized borough's share of income 23 from a national forest shall be proportional to the area of the national forest located 24 within its boundaries. This subsection does not apply to administrative boroughs. 25  * Sec. 59. AS 41.15.180(b) is amended to read: 26 (b) There is created as a separate account in the general fund the unorganized 27 borough national forest receipts fund. The fund consists of national forest income 28 received by the Department of Commerce, Community, and Economic Development 29 under 16 U.S.C. 500 for the percentage of a national forest located within the 30 unorganized borough or within an administrative borough. Seventy-five percent of 31 the fund shall be allocated for public schools and 25 percent for public roads. 01  * Sec. 60. AS 41.15.180(c) is amended to read: 02 (c) From the percentage of the unorganized borough national forest receipts 03 fund allocated to the public schools under (b) of this section, the commissioner shall 04 pay a share of the income from the public schools allocation of the fund to (1) each 05 home rule or first class city that is a school district and is located within the 06 unorganized borough or within an administrative borough and within a national 07 forest or within 20 miles of a national forest; and (2) each [, OR] regional educational 08 attendance area that has a school located within the unorganized borough or within an  09 administrative borough and within a national forest or within 20 miles of a national 10 forest [, A SHARE OF THE INCOME FROM THE PUBLIC SCHOOLS 11 ALLOCATION OF THE FUND]. A home rule city, first class city, or regional 12 educational attendance area's share shall be calculated as the proportion of the number 13 of children in average daily membership of the city school district or regional 14 educational attendance area compared to the total number of children in average daily 15 membership in city school districts located within the unorganized borough or within  16 an administrative borough and within the national forest or within 20 miles of the 17 national forest and in regional educational attendance areas that have a school located 18 within the unorganized borough or within an administrative borough and within the 19 national forest or within 20 miles of the national forest. 20  * Sec. 61. AS 41.15.180(d) is amended to read: 21 (d) From the percentage of the unorganized borough national forest receipts 22 fund allocated to public roads under (b) of this section, the commissioner shall pay 23 [TO EACH] 24 (1) to each administrative borough that exercises road powers and  25 is within a national forest or within 20 miles of a national forest, and to each 26 home rule city, first class city, or second class city that exercises road powers, that is 27 located within the unorganized borough or within an administrative borough and is 28 within a national forest or within 20 miles of a national forest, a share of the income 29 from the roads allocation of the fund; a municipality's [HOME RULE CITY, FIRST 30 CLASS CITY, OR SECOND CLASS CITY'S] share shall be calculated as the 31 proportion of the number of road miles within municipal boundaries over which the 01 municipality [COMMUNITY] exercises road powers plus the number of state road 02 miles maintained by the municipality under agreement with the state compared to the 03 total number of road miles maintained by state or local governments in the 04 unorganized borough or in an administrative borough and within the national forest 05 or within 20 miles of the national forest; 06 (2) to each municipality organized under federal law as an Indian 07 reserve that existed before the enactment of 43 U.S.C. 1618(a) and is continued in 08 existence under that subsection and that has formed a community development 09 corporation under AS 29.60.365, that exercises road powers and that is located within 10 the unorganized borough or in an administrative borough and within the national 11 forest or within 20 miles of the national forest a share of the income from the roads 12 allocation of the fund; the share due a municipality organized under federal law that 13 exercises road powers shall be calculated as the proportion of the number of road 14 miles within municipal boundaries over which the community exercises road powers 15 plus the number of state road miles maintained by the municipality under agreement 16 with the state compared to the total number of road miles maintained by state or local 17 governments in the unorganized borough or in an administrative borough and 18 within the national forest or within 20 miles of the national forest; however, the 19 commissioner may pay income from national forest receipts under this paragraph only 20 after the corporation has delivered a written waiver of sovereign immunity from legal 21 action by the state to recover all or a portion of the money distributed under this 22 section. 23  * Sec. 62. AS 41.15.180(f) is amended to read: 24 (f) For the purpose of making distributions from the fund, the commissioner of 25 commerce, community, and economic development shall consult with the 26 commissioner of education and early development, for purposes of determining the 27 number of children in average daily membership in the public schools affected by this 28 section, and the commissioner of transportation and public facilities, to determine the 29 total number of road miles in the unorganized borough or in an administrative  30 borough affected by this section. 31  * Sec. 63. AS 41.15.180(h) is amended to read: 01 (h) For purposes of this section, if a portion of an administrative borough or  02 of a home rule city, first class city, or second class city, or municipality organized 03 under federal law in the unorganized borough is located within the national forest or 04 within 20 miles of a national forest or if a regional educational attendance area has a 05 school located within the national forest or within 20 miles of the national forest, the 06 entire administrative borough, home rule city, first class city, or second class city, 07 regional educational attendance area, or municipality organized under federal law is 08 considered to be within the national forest. 09  * Sec. 64. AS 41.15.180(j) is amended to read: 10 (j) That portion of the unorganized borough national forest receipts fund 11 remaining in the account unobligated and unexpended on June 30 of a fiscal year shall 12 be deposited into the unrestricted portion of the general fund and shall be used to 13 offset expenses of the general fund for school and road maintenance in the affected 14 areas of the unorganized borough or of an administrative borough for which direct 15 distribution of funds has not been made. 16  * Sec. 65. AS 43.75.130(a) is amended to read: 17 (a) Except as provided in (d) of this section, the commissioner shall pay 18 (1) to each unified municipality, to each administrative borough, and 19 to each city located in the unorganized borough, 50 percent of the amount of tax 20 revenue collected in the municipality from taxes levied under this chapter; 21 (2) to each city located within a borough, 25 percent of the amount of 22 tax revenue collected in the city from taxes levied under this chapter; and 23 (3) to each home rule, first class, or second class borough 24 (A) 50 percent of the amount of tax revenue collected in the 25 area of the borough outside cities from taxes levied under this chapter; and 26 (B) 25 percent of the amount of tax revenue collected in cities 27 located within the borough from taxes levied under this chapter. 28  * Sec. 66. AS 43.75.130(d) is amended to read: 29 (d) Notwithstanding the provisions of (a)(2) and (a)(3)(B) of this section, the 30 commissioner shall pay 31 (1) to each city that is located in a borough incorporated after June 16, 01 1987, the following percentages of the tax revenue collected in the city from taxes 02 levied under this chapter: 03 (A) 45 percent of the taxes collected during the calendar year in 04 which the borough is incorporated; 05 (B) 40 percent of the taxes collected during the first calendar 06 year after the calendar year in which the borough is incorporated; 07 (C) 35 percent of the taxes collected during the second calendar 08 year after the calendar year in which the borough is incorporated; and 09 (D) 30 percent of the taxes collected during the third calendar 10 year after the calendar year in which the borough is incorporated; and 11 (2) to each home rule, first class, or second class borough that is 12 incorporated after June 16, 1987, the following percentages of the tax revenue 13 collected in the cities located within the borough from taxes levied under this chapter: 14 (A) 5 percent of the taxes collected during the calendar year in 15 which the borough is incorporated; 16 (B) 10 percent of the taxes collected during the first calendar 17 year after the calendar year in which the borough is incorporated; 18 (C) 15 percent of the taxes collected during the second calendar 19 year after the calendar year in which the borough is incorporated; and 20 (D) 20 percent of the taxes collected during the third calendar 21 year after the calendar year in which the borough is incorporated. 22  * Sec. 67. AS 46.14.400(a) is amended to read: 23 (a) With the approval of the department, a municipality may establish and 24 administer within its jurisdiction a local air quality control program that operates in 25 lieu of and is consistent with all or part of the department's air quality program as 26 established under this chapter. A first or second class borough or an administrative  27 borough may administer an air quality control program approved by the department 28 under this subsection on an areawide basis and is not subject to the restrictions for 29 acquiring additional areawide powers specified in AS 29.35.300 - 29.35.350. [A 30 THIRD CLASS BOROUGH MAY ADMINISTER A LOCAL AIR QUALITY 31 CONTROL PROGRAM APPROVED BY THE DEPARTMENT UNDER THIS 01 SUBSECTION ONLY IN A SERVICE AREA FORMED UNDER AS 29.35.490(b) 02 OR (c).] 03  * Sec. 68. AS 29.04.060(b); AS 29.05.031(b), 29.05.190(d); AS 29.20.300(b); 04 AS 29.35.220(c), 29.35.300(c), 29.35.320(b), 29.35.330(b), and 29.35.490(b) are repealed.