Legislature(1995 - 1996)

02/06/1996 01:07 PM CRA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
 HB 330 - UNINCORP COMMUNITY CAPITAL PROJ GRANTS                             
 TAPE 96-10, SIDE A                                                            
 Number 0001                                                                   
 CO-CHAIR IVAN called the meeting back to order at 2:41 p.m.  He               
 noted that committee packets for HB 330 included the bill; the                
 sponsor statement; affected statutes; a fiscal note from DCRA; a              
 zero fiscal note from the Department of Administration; letters in            
 support; and additional backup material.  He invited Representative           
 Carl Moses to present the bill.                                               
 Number 0053                                                                   
 REPRESENTATIVE CARL MOSES, sponsor of HB 330, explained the bill              
 called for more equitable distribution in the state's                         
 unincorporated capital project matching grant program by affording            
 unincorporated communities, existing within boroughs, the chance to           
 obtain the full $25,000 matching grant.  This had been consistently           
 available to those unincorporated communities that existed outside            
 of organized boroughs.  Communities inside boroughs, which had                
 shared from a pool of resources obtained by the boroughs, had fared           
 much less well, on average, than unincorporated communities outside           
 of boroughs.  This bill would restore equity by making communities            
 within boroughs eligible under the same program currently in place            
 for outside communities.  It would have them adhere to the same               
 criteria for eligibility; it would correspondingly reduce their               
 boroughs' eligibility through the municipal capital project                   
 matching grant program to avoid double-dipping.  It would also                
 increase the list of potential applicant communities by up to 60.             
 Representative Moses noted that participants familiar with the                
 issue were available to testify via teleconference.  He added that            
 experts were also present to answer technical questions.  He                  
 concluded by noting there had been a similar bill in 1964.                    
 Number 0280                                                                   
 CO-CHAIR IVAN referred to the unincorporated communities,                     
 municipalities and second-class cities that received the $25,000              
 capital matching grants under the program.  He asked whether HB 330           
 affected unincorporated communities not currently eligible or                 
 whether there was a funding disparity among recipients.                       
 Number 0325                                                                   
 REPRESENTATIVE MOSES responded that an unincorporated community               
 within a borough received less money, sharing in a pool received by           
 the borough.  If it were outside a borough, it received the full              
 $25,000.  In essence, the law discouraged a community from going              
 into a borough, because it would receive less money under the grant           
 Number 0366                                                                   
 CO-CHAIR AUSTERMAN noted that DCRA's fiscal note indicated                    
 approximately 60 unincorporated communities could participate; the            
 fiscal note starting in 1996 was for $42 million, increasing to $49           
 million in FY 2001.  He thought HB 330 was a good bill and that the           
 committee should go ahead and move it out; the only question would            
 probably be the fiscal note, he said.  He added that the bill would           
 go to the House Finance Committee next, where the fiscal note                 
 should be discussed.                                                          
 Number 0425                                                                   
 REPRESENTATIVE MOSES clarified the amounts were not millions of               
 dollars, but thousands.  He noted that in the similar 1964                    
 legislation, there was no fiscal note attached, indicating DCRA               
 felt it could handle it within its budget.                                    
 Number 0442                                                                   
 REPRESENTATIVE ELTON said he had no problem with moving it from               
 committee.  He said it was a great program for unorganized                    
 communities outside of boroughs; it ought to be a great program for           
 those inside boroughs as well.  He added that they should not                 
 penalize everyone else by not funding the program and having the              
 money taken from other people's budgets.  He encouraged the                   
 legislature to take the second step, to not only authorize it, but            
 to fund it as well.                                                           
 Number 0483                                                                   
 CO-CHAIR IVAN noted that the sponsor had said unincorporated                  
 communities belonging to a borough received less than those in                
 unorganized boroughs.  This seemed like a reverse of policy.  He              
 added it was in the state's interest to organize communities in as            
 many areas as possible.                                                       
 Number 0513                                                                   
 REPRESENTATIVE KOTT asked Representative Moses about the grant                
 monies available.  Specifically, he wondered if there was a set               
 amount of money, without adding any to the grant program, to                  
 disburse to the various communities.                                          
 Number 0550                                                                   
 REPRESENTATIVE MOSES replied more could be added to it.                       
 Technically, though, it would be pro rata among the communities,              
 slightly decreasing the present allotments unless money were added.           
 He emphasized that the amounts should be equitable to all                     
 unincorporated communities, without penalizing those that had                 
 joined a borough.  In essence, he said, that would encourage                  
 communities to disassociate themselves from boroughs.                         
 Number 0598                                                                   
 REPRESENTATIVE KOTT responded that was basically what he was                  
 driving at; he did not think more money needed to be added to the             
 program.  It would be nice, he said, but not required.  It was an             
 equitability issue and it would be the only fair thing to do.                 
 Number 0624                                                                   
 REPRESENTATIVE ELTON said he thought that was exactly right.  They            
 did not have to expand the pie.  However, if they did not,                    
 everybody would get less, which he did not favor.  If the program             
 was good for those now receiving it, it should be good for others.            
 If they did not expand the pie, people would be penalized because             
 the legislature did the right thing by expanding the program to               
 other communities.  He thought HB 330 was equitable and fair and              
 ought to be moved out of committee.  However, he hoped the                    
 legislature would think about making the pie a little bigger to               
 accommodate the new communities without penalizing the existing               
 Number 0687                                                                   
 WALT WREDE, Manager, Lake and Peninsula Borough, testified via                
 teleconference from King Salmon in favor of HB 330.  He said the              
 bill would implement the original intent of the program, as he                
 understood it, fixing a problem that had existed for several years.           
 He explained the Lake and Peninsula Borough area was adversely                
 affected by the program as it now existed.  The borough had 11                
 unincorporated villages, representing almost half the borough's               
 population, that did not qualify for the $25,000 matching grant               
 Number 0774                                                                   
 MR. WREDE explained that in 1995, the Lake and Peninsula Borough              
 received a grant of $44,000, to be divided up among the 11                    
 communities; they expected to receive approximately the same amount           
 for 1996.  He noted that $4,000 was not much money.  If each                  
 village was guaranteed $25,000 per year, that would total $275,000            
 per year.  He added that communities could roll funds over from               
 year to year, which would allow money to accumulate.                          
 Number 0827                                                                   
 MR. WREDE cited a number of reasons why he felt the current system            
 was unfair.  He noted that Representative Elton had spoken                    
 eloquently about the fairness issue.  Mr. Wrede said the way the              
 program was currently set up hurt economic development and                    
 investment in capital improvements in the borough.  There was also            
 a policy issue, which Co-Chair Ivan had mentioned, where the state            
 was trying to downsize and transfer more responsibility to local              
 governments.  Mr. Wrede felt that was good, but said the current              
 grant program acted as a disincentive to forming organized                    
 boroughs.  He reiterated that the borough strongly supported HB
 Number 0990                                                                   
 DAN SALMON, Administrator, Village of Igiugig, testified via                  
 teleconference from King Salmon.  He explained that Igiugig, a                
 small village of approximately 40 people that swelled to 150 - 200            
 in the summertime due to tourism, was located at the west end of              
 Lake Iliamna, within the Lake and Peninsula Borough.  He said HB
 330 greatly affected his community.  Igiugig currently funded its             
 own preschool, snow removal, street maintenance, refuse disposal              
 and so forth.  Funds to garner capital projects were difficult to             
 obtain.  The village lacked sufficient bulk fuel storage                      
 facilities, fire fighting equipment, emergency services facilities,           
 and equipment to build and maintain projects, among other things.             
 As intended originally, Mr. Salmon said, the grant program would              
 have been an avenue for Igiugig to realize its economic development           
 goals and plans.  It also would have created a level playing field            
 for communities.                                                              
 Number 1067                                                                   
 MR. SALMON said right now, his village could not compete with                 
 unincorporated villages in unorganized boroughs.  Igiugig, with its           
 $4,000 grants, had to compete for projects with communities that              
 could put up $25,000.  That inequitable distribution of money had             
 resulted in less major capital projects being accomplished in his             
 community.  He said Igiugig supported HB 330, as he was sure other            
 similarly situated villages would.                                            
 Number 1165                                                                   
 REPRESENTATIVE KOTT moved that HB 300 move from committee with                
 individual recommendations and accompanying fiscal notes.  There              
 being no objection, it was so ordered.                                        

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