03/09/2005 01:30 PM Senate COMMUNITY & REGIONAL AFFAIRS

                                                                                                                                
         SB 114-SERVICE AREAS IN SECOND CLASS BOROUGHS                                                                      
                                                                                                                              
1:39:34 PM                                                                                                                    
                                                                                                                              
CHAIR GARY STEVENS announced SB 114 to be up for consideration.                                                                 
                                                                                                                              
MELANIE LESH,  staff to Senator  Gary Stevens, explained  that SB
 relates  to consolidation or  dissolution of  certain service                                                               
areas in  second-class boroughs. It  is the companion bill  to HB
 that is awaiting final House action.                                                                                        
                                                                                                                                
MS.  LESH  explained  that  Senator Gary  Stevens  was  asked  to                                                               
introduce SB 114 to help  resolve unintended consequences related                                                               
to  the  creation then  cessation  of  funding for  road  service                                                               
districts.                                                                                                                      
                                                                                                                                
Initially  state   revenue  sharing   was  sufficient   to  allow                                                               
subdivisions outside  city limits  to maintain local  area roads.                                                               
Local  service  area road  commissions  were  created to  collect                                                               
revenue  sharing based  on the  miles of  road in  the particular                                                               
service area.                                                                                                                   
                                                                                                                                
When the revenue sharing program  terminated, a number of service                                                               
areas  had  insufficient  funding to  perform  road  maintenance.                                                               
Those  service areas  became non-functional  and  roads in  those                                                               
service areas are deteriorating.                                                                                                
                                                                                                                                
Second Class  Boroughs have  no road powers  and no  authority to                                                               
dissolve  a service  area without  a vote  of the  residents, but                                                               
even  so  they  are  concerned  about  their  liability  for  the                                                               
deteriorating roads. The proposed  statute change would allow for                                                               
the dissolution or consolidation of non-functioning districts.                                                                  
                                                                                                                                
MS. LESH  stated that SB 114  serves to resolve a  problem in the                                                               
Fairbanks  North  Star Borough  and  the  borough attorney  would                                                               
provide further explanation.                                                                                                    
                                                                                                                                
1:41:29 PM                                                                                                                    
                                                                                                                                
RENEE  BROKER, attorney  for the  Fairbanks  North Star  Borough,                                                               
reported  that  the borough  has  107  road-service areas.  Since                                                               
state revenue sharing terminated,  some service areas have become                                                               
unable  or unwilling  to tax  themselves sufficiently  to provide                                                               
some  or any  road maintenance.  Some service  areas aren't  even                                                               
able  to  attract commissioners  to  serve  on the  service  area                                                               
boards, which  means they are  headed for legal  dysfunction. The                                                               
Fairbanks North Star Borough supports  SB 114 to regain a measure                                                               
of  control since  it has  the  responsibility for  dysfunctional                                                               
service areas and  the liability for poorly  maintained roads. It                                                               
wants to step in and  exercise responsible action with respect to                                                               
those  service  areas  specifically,   but  has  no  interest  in                                                               
extending  its authority  to service  areas that  are functioning                                                               
legally and as intended.                                                                                                        
                                                                                                                                
CHAIR GARY STEVENS asked Ms. Moss to come forward.                                                                              
                                                                                                                                
1:44:00 PM                                                                                                                    
                                                                                                                                
RYNNIEVA MOSS, legislative aide  for Representative John Coghill,                                                               
reported she  was testifying in support  of SB 114 as  chair of a                                                               
road service district in North Pole.                                                                                            
                                                                                                                                
Initially she had concerns  about protecting properly functioning                                                               
service districts but she is  comfortable that the language in SB
  does  provide  protection to  service  areas  that  function                                                               
properly and allows them to continue to conduct their business.                                                                 
                                                                                                                                
1:44:52 PM                                                                                                                    
                                                                                                                                
CHAIR GARY  STEVENS asked Ms. Moss  if she sees the  advantage in                                                               
removing road service areas that are non-functioning.                                                                           
                                                                                                                                
MS. MOSS  replied yes  and recapped the  issue that  Second Class                                                               
Boroughs  become  liable  for roads  that  aren't  maintained  in                                                               
accordance with the state statutes  that set up the service area.                                                               
SB  114  removes that  liability.  She  contended that  it's  the                                                               
people  that  live in  the  service  areas  that will  be  liable                                                               
because ambulances, fire trucks  and school buses will eventually                                                               
stop using roads that aren't maintained.                                                                                        
                                                                                                                                
CHAIR GARY STEVENS said the  borough might become the deep pocket                                                               
in the event of a lawsuit.                                                                                                      
                                                                                                                                
KEVIN RITCHIE, Alaska Municipal  League (AML), reported that both                                                               
the AML legislative committee and  the AML board strongly support                                                               
SB 114.                                                                                                                         
                                                                                                                                
There was no further testimony.                                                                                                 
                                                                                                                                
1:46:57 PM                                                                                                                    
                                                                                                                                
CHAIR GARY  STEVENS announced he  would hold SB 114  in committee                                                               
and take action at the next meeting.