Legislature(2005 - 2006)CAPITOL 124

03/29/2005 08:00 AM House COMMUNITY & REGIONAL AFFAIRS

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* first hearing in first committee of referral
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= bill was previously heard/scheduled
Heard & Held
Heard & Held
Heard & Held
Bills Previously Heard/Scheduled
HB  36-APPROP: MUNI REVENUE SHARING/SAFE COMM                                                                                 
CO-CHAIR OLSON  announced that the  next order of  business would                                                               
be HOUSE  BILL NO. 36,  "An Act  making an appropriation  for the                                                               
state revenue  sharing program and  the safe  communities program                                                               
at  fiscal  year  1998  levels, as  adjusted  for  inflation,  to                                                               
provide  for  public safety  and  other  municipal services;  and                                                               
providing for an effective date."                                                                                               
8:56:23 AM                                                                                                                    
REPRESENTATIVE MARY  KAPSNER, Alaska State  Legislature, sponsor,                                                               
began by noting her disappointment that  HB 28 didn't move out of                                                               
committee because it's  a long-term fix [for  the revenue sharing                                                               
and safe  communities programs], while  HB 36 is a  one-year fix.                                                               
She  explained that  HB 36  would reinstate  municipal assistance                                                               
and revenue  sharing at fiscal year  (FY) 1998 levels.   The 1998                                                               
levels  were  chosen  because  it  was  during  a  more  fiscally                                                               
conservative time  that also recognized  the important  role that                                                               
municipalities play in the delivery  of services to all Alaskans.                                                               
Representative  Kapsner  informed  the committee  that  currently                                                               
staffing at the small community level  is skeletal.  If no one is                                                               
present  to open  mail,  then  no one  is  there  to receive  the                                                               
notices  regarding federal  grants  for which  they could  apply.                                                               
She    reviewed   the    services   provided    by   communities.                                                               
Representative   Kapsner   highlighted  that   this   legislation                                                               
acknowledges  the constitutional  obligation  to provide  certain                                                               
services, such  as public safety,  public health,  education, and                                                               
transportation.   Whether the services are  delivered through the                                                               
state or local level, these constituents  have to be served.  The                                                               
choice is whether to have  the municipalities close and shift the                                                               
responsibility back  to the state with  line item appropriations.                                                               
Representative Kapsner pointed out that  while an increase in the                                                               
price of oil is good for  the state, it's not good for consumers,                                                               
municipalities,  and small  communities.   Representative Kapsner                                                               
related that she  had looked forward to this  session because she                                                               
hadn't  anticipated the  fighting  over pennies,  but rather  had                                                               
expected that  there would  be more generosity  of spirit  and an                                                               
understanding that municipalities are hitting hard times.                                                                       
9:01:19 AM                                                                                                                    
REPRESENTATIVE LEDOUX turned attention to  Table 2 in the January                                                               
2005  Legislative Research  Service  Report, which  lays out  the                                                               
revenue sharing distribution to  unincorporated communities.  She                                                               
noted that  none of the  seven unincorporated communities  in her                                                               
district are listed in Table 2.                                                                                                 
REPRESENTATIVE  KAPSNER reminded  the committee  that this  table                                                               
refers  to the  1998 allocation.    She offered  to research  why                                                               
those communities weren't receiving the appropriation in 1998.                                                                  
REPRESENTATIVE  LEDOUX  surmised  that  those  seven  communities                                                               
didn't  receive  municipal  revenue   sharing  because  they  are                                                               
unincorporated  communities   within  an   incorporated  borough.                                                               
However,  she  said she  didn't  see  any reason  to  distinguish                                                               
between  unincorporated  and  incorporated communities  within  a                                                               
REPRESENTATIVE  KAPSNER  recalled  that  in 1996,  because  of  a                                                               
Senate   initiative,    the   contribution    to   unincorporated                                                               
communities  was ratcheted  down.   For further  information, she                                                               
deferred to Mr. Rolfzen with DCCED.                                                                                             
9:03:23 AM                                                                                                                    
CO-CHAIR THOMAS  inquired as to  why Metlakatla received  zero in                                                               
municipal revenue sharing.  He  then turned to the municipalities                                                               
on the  1998 list, and  informed the committee that  Gustavus has                                                               
re-filed for second  class city status and it's not  on the list,                                                               
which  is the  case with  other  communities as  well.   Co-Chair                                                               
Thomas said  that he didn't  realize that  it takes two  to three                                                               
years to be recognized as a  municipality.  He expressed the need                                                               
to provide incentives for communities to organize.                                                                              
9:05:07 AM                                                                                                                    
KATHIE WASSERMAN,  Alaska Municipal League (AML),  commented that                                                               
although some  say that  the state  is in  good shape  and making                                                               
money, the smaller communities don't  seem to be benefiting.  She                                                               
highlighted the  rising costs  for fuel,  insurance, and  PERS as                                                               
well  as  the  loss  of  capital  grants,  revenue  sharing,  and                                                               
reimbursement of  the senior and  veteran tax, all of  which make                                                               
it difficult for  these [smaller communities].   She concluded by                                                               
relating AML's support for HB 36.                                                                                               
9:06:50 AM                                                                                                                    
REPRESENTATIVE DAVID GUTTENBERG,  Alaska State Legislature, spoke                                                               
in support of HB 36.  He  reviewed the erosion of funds for areas                                                               
throughout  the state.    Representative  Guttenberg opined  that                                                               
since the state is receiving  higher oil revenues, it should pass                                                               
some [of  that revenue] on  to the  communities.  He  pointed out                                                               
that many communities  have no sustaining sources of  income.  He                                                               
echoed  earlier testimony  regarding the  lack of  local staffing                                                               
and  the  difficulties  it creates.    Representative  Guttenberg                                                               
opined   that  it's   key  for   the  state   to  recognize   its                                                               
responsibility   to   give   back  to   communities,   which   he                                                               
characterized as  most efficient because when  things fall apart,                                                               
they find their way to  the legislature.  "Maintenance of dollars                                                               
will prevent that," he opined.                                                                                                  
9:10:24 AM                                                                                                                    
BOBBY ANDREW, President, Aleknagik  Natives Limited, informed the                                                               
committee that  the Village of  Aleknagik signed a  memorandum of                                                               
understanding (MOU) October 29,  2000, to address village issues,                                                               
especially in  the face  of declining revenues  coming in  to the                                                               
village.   Once HB 36  passes, it  will help those  villages that                                                               
don't have  a tax base.   He pointed out  that most of  the lands                                                               
[in many  of the villages]  are town sites or  Native allotments.                                                               
He informed  the committee that the  main offices of many  of the                                                               
regional corporations are located in  urban areas.  He emphasized                                                               
that there  are many needs in  the Village of Aleknagik,  such as                                                               
improving the  water and sewer  systems.  This  legislation would                                                               
assist the  village.  In  fact, [the assistance provided  by this                                                               
legislation] could  help with the  matching dollars that  some of                                                               
the  programs  for which  communities  apply.   The  [Village  of                                                               
Aleknagik] is fortunate  to be able to utilize  [some funds] from                                                               
the Bristol Bay Economic Development Corporation.                                                                               
9:13:20 AM                                                                                                                    
REPRESENTATIVE KAPSNER  inquired as to  with whom the  Village of                                                               
Aleknagik's MOU was.                                                                                                            
MR. ANDREW  answered that  the MOU  is between  Aleknagik Natives                                                               
Limited,  the  Aleknagik Traditional  Council,  and  the City  of                                                               
Aleknagik.   He  informed the  committee that  the aforementioned                                                               
organizations meet quarterly.  At  a recent meeting, a resolution                                                               
in support of HB 36 was passed.                                                                                                 
9:14:22 AM                                                                                                                    
CO-CHAIR  OLSON announced  that  all  three municipal  assistance                                                               
bills would be back before the committee next week.                                                                             
9:15:01 AM                                                                                                                    
BILL  ROLFZEN,   State  Revenue  Sharing   Municipal  Assistance,                                                               
Division   of  Community   Advocacy,   Department  of   Commerce,                                                               
Community,   &  Economic   Development   (DCCED),  informed   the                                                               
committee that  the revenue sharing  program was revised  in 1980                                                               
to the current statutory program,  which only provides funding to                                                               
unincorporated areas within organized  boroughs.  Therefore, that                                                               
was followed  in HB 36.   With regard to the  communities such as                                                               
Gustavus not  being on the lists,  the data used is  from the end                                                               
of  fiscal year  2004, prior  to the  governor's veto.   If  this                                                               
legislation is enacted,  the information would be  updated.  With                                                               
regard  to  the  community  of   Metlakatla,  it,  under  revenue                                                               
sharing, received  funding as an unincorporated  community; under                                                               
safe  communities, it  received  funding as  a municipality;  and                                                               
under  capital   matching  grants  it  received   funding  as  an                                                               
unincorporated entity.                                                                                                          
9:16:23 AM                                                                                                                    
REPRESENTATIVE CISSNA  pointed out that  the City of  Gustavus is                                                               
listed on Table 2.                                                                                                              
MR.   ROLFZEN   clarified   that   in  2004   Gustavus   was   an                                                               
unincorporated community, but now it's a city government.                                                                       
CO-CHAIR THOMAS  commented that the  amount of money  a community                                                               
receives is dependent upon how it's organized.                                                                                  
[HB 36 was held over.]                                                                                                          

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