Legislature(1993 - 1994)
04/07/1994 08:00 AM House STA
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 393 - UNINCORPORATED COMMUNITIES CAPITAL PROJECT GRANT CHAIRMAN VEZEY opened HB 393 for discussion. He stated information had been prepared to answer questions about financing additional cities. He asked JOE RYAN for an explanation of the report. Number 595 JOE RYAN, STATE AFFAIRS COMMITTEE AIDE, explained the report on HB 393. He stated there had been concern from the Fairbanks North Star Borough as to whether it would lose revenue if HB 393 went into effect. He discussed the concern with Judi Slajer, Chief Financial Officer, Fairbanks North Star Borough, who felt there would be an approximate 10 percent loss, or perhaps $120,000 less moneys. MR. RYAN stated the report (on file) illustrates what the allocations would be. He understood the legislative function would be that two programs will be set up, whereby certain amounts of funds will be allocated to the rural program and other amounts will be allocated to the other programs. The report breaks down what each community would be eligible to receive, examining grant number, population, matching amount and grant, if HB 393 goes into effect. MR. RYAN stated he was unable to answer whether the percentage of grant would be reduced for the smaller communities. He noted a 30 percent reduction for the larger communities. Number 619 CHAIRMAN VEZEY clarified the report illustrates how the program would distribute if HB 393 became law. He noticed there was not a comparison of current status. Number 624 MR. RYAN commented there have been several people out sick from different departments, therefore he has had difficulty getting comparative data. Number 631 CHAIRMAN VEZEY stated the extra grants to the unincorporated communities within boroughs would be allocated out of the total program receipts. MR. RYAN clarified the allocation is made by the legislature. He stated the distribution formula is based upon population figures, with central pie. If the population in a borough was reduced or not counted, they would proportionately receive less money. Additional communities figured in individually would subtract from the total population figure, thereby the share of the pie for the larger community would proportionately reduce. Number 641 CHAIRMAN VEZEY estimated the formula appears to allocate in boroughs about $10 per citizen. For example, presently if Salcha represented 400 people in the Fairbanks North Star Borough (FNSB), the borough would receive $4,000. Under HB 393, if Salcha was eligible, it would receive $25,000, reducing the money available in the pool. Number 645 MR. RYAN added the population of the FNSB would be reduced. (REPRESENTATIVE KOTT left the meeting at 9:39 a.m.) Number 658 REPRESENTATIVE GARY DAVIS agreed HB 393 would reduce the amount to the borough; however, in most cases the borough would already have a project they were funding in that unincorporated area. MR. RYAN pointed out HB 393 hinges on legislative appropriation because, from his understanding, there will be two appropriations. Number 674 CRYSTAL SMITH, ALASKA MUNICIPAL LEAGUE, commented on HB 393. She stated there are two concerns about HB 393: 1) funding within a borough would shift from the borough to the unincorporated communities - organized to unorganized government structure; and 2) in the absence of additional funding and the letter of intent from the Community & Regional Affairs Committee, the effect of adding several unincorporated communities would be to reduce every incorporated community's share of the total appropriation. She noted there is a net need for additional funds, or a net decrease for municipal governments. HB 393 is another example of a disincentive to the organization of local government. (REPRESENTATIVE OLBERG left the meeting at 9:40 a.m.) (REPRESENTATIVE KOTT returned to the meeting at 9:40 a.m.) Number 692 CHAIRMAN VEZEY clarified HB 393 would be a good policy if the legislature was looking for a method to go to something other than organized boroughs. Number 693 MS. SMITH stated she would not say that, but HB 393 is another disincentive for people to organize or keep organized. Number 695 CHAIRMAN VEZEY recognized the joint session starting at 9:45 a.m. HB 393 was held in committee. ADJOURNMENT CHAIRMAN VEZEY adjourned the meeting at 9:43 a.m. BILLS NOT HEARD
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